What is Financial Inclusion Plan (FIP)?
What is Financial Inclusion Plan (FIP)?

Financial Inclusion Plan is the RBI designed financial inclusion measures to be implemented by commercial banks to provide banking services in unbanked villages. As part of the programme, all public sector and private sector banks have to prepare a three-year plan to extend their services in the identified unbanked areas.

The FIP was implemented in two phases – 2010- 2013 and 2013-2016.

The FIP broadly include self-set targets in respect of rural brick and- mortar branches opened; BCs (Business Correspondents) employed; coverage of unbanked villages with a population above 2,000 as also other unbanked villages with population below 2,000 through branches; BCs and other modes; no-frills accounts opened, including through BC-ICT (Business Correspondent using Information and Communication Technology); KCCs (Kisan Credit Cards) and GCCs (General Credit Cards) issued; and other specific products designed by them to cater to the financially excluded segments.

Thus under FIP, banks can provide its services in any selected mode including opening of a branch, business correspondents etc.

Phase I

During Phase I, 74,414 unbanked villages with population more than 2,000 were identified and allotted to various banks through SLBCs (State Level Bank Committees) for coverage through various modes, that is, branches, BCs or other modes such as ATMs and satellite branches, etc.

Achievements under Phase I of FIP

With the completion of the first phase, a large banking network has been created and a large number of bank accounts have also been opened.

During the first phase, nearly 74,000 villages with population more than 2,000 were provided with a banking outlet. All these unbanked villages have been covered by opening banking outlets comprising 2,493 branches, 69,589 BCs and 2,332 through other modes.  

After completion of the first FIP period, it was realized that although a large banking network had been created along with the opening of large number of bank accounts, simply creating the banking infrastructure and opening banking accounts would not fulfill the objectives of achieving meaningful financial inclusion. As an improved governance measure, with an underlying objective of ensuring involvement of all stakeholders in the Financial Inclusion efforts and in order to ensure uniformity in the reporting structure under the Financial Inclusion Plan, banks were advised to ensure that their FIPs are disaggregated and that they percolate down up to the branch level.

Second Phase of FIP

In the second phase, the remaining unbanked villages which in number is close to 4,90,000, are identified. Most of these villages have a population of less than 2000 people.  These villages are allocated to banks, for opening of banking outlets by March 2016.

Similarly, the second phase also tries to improve the performance of the first phase by ensuring that the newly opened accounts will remain active. For this more branch level participation is sought by banks. For this, banks were advised that the FIPs prepared by them are disaggregated and percolate down to the branch level so as to ensure the involvement of all the stakeholders in FI efforts. The focus under the new plan is now more on the volume of transactions in the large number of accounts opened.

As per the progress reports received from SLBCs, banks had opened banking outlets in 1,83,993 unbanked villages by March 2014, comprising 7,761 branches, 163,187 BCs and 13,045 through other modes. The Reserve Bank is closely monitoring the progress made by the banks under the roadmap.


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