Deposit Assessment in India

This paper examines the need for improving access to financial services for low-income clients in India.

The paper discusses the supply and demand sides of microsavings options for poor people in India. It also highlights regulatory and operational challenges and opportunities for financial institutions and mobile banking platforms that want to serve the low-income market.

The paper states that India needs to move away from the credit-only approach to increase microsavings offerings to ensure high quality financial inclusion for its poor. Other suggestions for the way forward include:

• IFC and other donors can contribute by providing support for the development and design of new products and processes;
• Advances in mobile phone-based technology shows promise and should be leveraged;
• There is a huge opportunity for designing recurring deposit products for poor people who have regular income and voluntary savings or fixed deposits for those who have variable income;
• Sector players could continuously monitor pilot tests, make required modifications in product features and processes and develop the right kind of marketing and promotion to develop a scalable and viable business model.