The RBI’s composite financial inclusion index (FI-Index), capturing the extent of financial inclusion across the country, rose to 60.1 in March 2023, showing growth across all parameters.
The index captures information on various aspects of financial inclusion in a single value ranging between 0 and 100, where 0 represents complete financial exclusion and 100 indicates full financial inclusion.
“Index for the year ending March 2023 has since been prepared. The value of the FI Index for March 2023 stands at 60.1 vis-a-vis 56.4 in March 2022, with growth witnessed across all sub-indices,” the Reserve Bank of India said in a statement on Friday.
Improvements in the FI Index were mainly contributed by Usage and Quality dimensions, reflecting the deepening of financial inclusion, it added.
In August 2021, the central bank said it has been conceptualised as a comprehensive index, incorporating details of banking, investments, insurance, postal, as well as the pension sector, in consultation with government and respective sectoral regulators.
The FI-Index comprises three broad parameters – Access (35%), Usage (45%), and Quality (20%), with each of these consisting of various dimensions, which are computed based on a number of indicators.
The index is responsive to ease of access, availability and usage of services, and quality of services.
According to the RBI, a unique feature of the index is the quality parameter which captures the quality aspect of financial inclusion as reflected by financial literacy, consumer protection and inequalities and deficiencies in services.