RBI moots apps for feature phones to deepen financial inclusion
Mumbai: The Reserve Bank of India has urged banks and finance companies to launch low-bandwidth apps and flexible products that can reach remote parts of India and underserved populations, as part of its drive towards 100% financial inclusion, said people privy to the development. The RBI has also asked banks and finance companies to ensure that the new apps and digital products have features to prevent cyber fraud.
The central bank is urging banks to design digital products that meet the needs of customers using feature phones with low bandwidth since connectivity is a major roadblock in remote parts of the country.
All retail banking products are currently available through mobile applications on smartphones. However, not all services are made available on feature phones. The RBI is aiming to bridge this gap.
Separately, the RBI said it is planning to review regulations on internet and mobile banking for all banks.
Upon taking charge as the RBI governor, Sanjay Malhotra, had started financial inclusion, which implies making financial services available to all citizens, especially the underserved population. The Reserve Bank's Financial Inclusion Index (FI-Index), which measures the extent of financial inclusion in the country, improved from 60.1 in March 2023 to 64.2 in March 2024, according to latest data published by the central bank. The index covers access, usage and quality of financial services. The RBI plans to review the index in FY26.
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The RBI is planning to conduct a survey on the usage of digital payments, it said in its latest annual report. The survey will be done to "understand transaction behaviour and challenges faced by users, thereby facilitating evidence-based decision making towards enhancing financial inclusion and making payment systems more effective".
The RBI is also encouraging banks to design products that meet customer needs such as flexible repayments, variable savings and seasonally adapted services-enhancing access, usage, and service quality, RBI deputy governor M Rajeshwar Rao said early this month.
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