A Blueprint for the Delivery of Comprehensive Financial Services to the Poor in India

This note attempts to articulate a new vision for the scaled delivery of comprehensive financial services to the rural and urban poor of India.

The note states that:

• Access to finance is the ability of economic participants to obtain a range of financial services with ease and at reasonable prices;
• Improving access can have a strong welfare impact on the very poor;
• These financial services allow participants to smooth consumption, face adverse shocks, use their skill sets and generate surpluses for investments;
• However, the supply of formal financial services in India falls far below the demand for these services.

The note:

• Draws on lessons from previous experiences in this sector, both in India and other international markets;
• Documents the contributions of a few Indian banks and financial service providers in this area;
• Discusses in detail ICICI Bank's contribution towards helping the poor access financial services.

The note concludes that:

• Access to financial services for the poor is a critical part of the growth and development process of any country.
• ICICI Bank's approach attempts to build natural partnerships in the pursuit of universal access to financial services.
• The following steps are necessary to increase access:
  • Design of new products and individual lending methodologies;
  • Investments in training and technology;
  • Advisory support for microfinance entrepreneurs;
  • Credit bureau design and microfinance program evaluations.