India’s Financial Inclusion Intensified In FY23: RBI Data

The RBI's composite Financial Inclusion index (FI-Index), which measures the level of financial inclusion across the country has increased to 60.1 in March 2023, indicating growth across all criteria.

This index collects information on multiple dimensions of financial inclusion into a single value ranging from 0 to 100. Here, 0 indicates complete financial exclusion, while 100 denotes absolute financial inclusion.

"The index for the year ending March 2023 has now been compiled. The FI Index for March 2023 is recorded at 60.1 compared to 56.4 in March 2022, with growth observed in all sub-indices," stated the Reserve Bank of India in a release on Friday.

The increase in the FI Index was mainly driven by improvements in the Usage and Quality dimensions, depicting a deepened financial inclusion, it further noted.

Back in August 2021, the central bank said that it was conceptualised as a comprehensive index, encompassing details of banking, investments, insurance, postal services, as well as the pension sector, in consultation with the government and respective sectoral regulators.

The FI-Index consists of three main parameters – Access (35 per cent), Usage (45 per cent), and Quality (20 per cent), each of which comprises various dimensions, calculated based on several indicators.

This index has parameters like ease of access, availability, and utilization of services, as well as the quality of these services.