Profitable Models for Financial Inclusion

BANCON 2011 Selected Conference Papers

13 Pages Posted: 10 Jun 2012

Date Written: July 10, 2011

Abstract

Rural India presents a remarkable opportunity for banks and financial institutions to seek their fortunes and bring prosperity to the aspiring poor through financial inclusion. In a fast growing economy like India the poor are the middle class of tomorrow and banks could, therefore, ill-afford to ignore this segment. Banks, however, argue that while the benefits of financial inclusion can be easily understood, the costs of serving the poor can be significant in the short-term, thereby impacting profitability. Banks, therefore, need to take bold decisions and reach out to rural India with strategies and business models which are beyond the realm of conventional thinking. This paper looks at some of the business models and the essential elements of profitable models for financial inclusion.

Keywords: Models, Financial Inclusion

JEL Classification: D60, E21, E50

Suggested Citation

Raj, Brij, Profitable Models for Financial Inclusion (July 10, 2011). BANCON 2011 Selected Conference Papers, Available at SSRN: https://ssrn.com/abstract=2080845

Brij Raj (Contact Author)

Reserve Bank of India ( email )

South Gandhi Maidan
Patna, Bihar 800001
India

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