The much awaited third dataset on financial inclusion, Global Findex, was released last month. India has reported a significant leap in financial inclusion - 80% of Indians above the age of 15 had a formal financial account in 2017, compared to 53% in 2014 and 35% in 2011. However, while ownership and access to accounts have improved dramatically, 48% of registered formal financial accounts were reported to be dormant. Clearly, we still have to crack the challenge of making banking relevant to the financial lives of low income customers. Policy should make a shift from being mandate driven to being ecosystem oriented. This calls for a paradigm shift in the regulatory mindset.

There is already a churn in the industry. Not just through new entrants - Jio Payments Bank entered the fray last month – but also new payment systems - UPI popularity is growing with transactions rising to 190 million in April. However, from the lens of financial inclusion, we now need to measure the impact of these changes on the lives of low income customers, to measure the spread of the banking habit in rural and remote areas.

The time is ripe for a complete overhaul of our data collection systems, towards a database that accurately reflects progress on financial inclusion. Last month the RBI announced that a Data Sciences Lab will be operational by the end of the year. Indicus policy briefs have been highlighting the lacunae in available data (see for instance, Monitoring the Progress of Financial Inclusion in India), and we hope that the RBI will take this opportunity to push the envelope for financial inclusion. Monitoring data of usage at a granular level of city, block and village will help to pinpoint gaps in coverage and service delivery, and coordination with entities like TRAI and NPCI will provide visibility into specific dark spots of financial and network coverage.

This month, the General Data Protection Regulation (GDPR) comes into force - See Emma Firth’s list of the ten things you need to know. In India, we are still charting our way through issues relating to data protection and privacy. Ideally, the RBI and the government should aim for a consultative process, with minimum disruption; however, the industry has just been hit hard by a tight deadline – on April 6th, the RBI mandated all payment companies—global and local—to set up data storage facilities within India by October.

• ICFI Blog: Update on the new kids on the block - payments banks
• ICFI Blog: Changing banking
• India’s Agent Network for Financial Inclusion - Indicus Policy Brief February,2018
• Fostering Innovation For Financial Inclusion – Indicus Policy Brief January,2018
• ICFI Blog: The challenge of exclusion
• Pradhan Mantri Jan Dhan Yojana Progress Report
• RBI Electronic Payment Systems – Data

• India at the forefront of global growth in financial inclusion: World Bank

• India's digital platforms

• Financial inclusion is making great strides

• How the humble postman will bring banking to your doorstep

• Deposits in Jan Dhan accounts cross Rs 80000 crore

• India Post Payment Bank by month-end

• RBI tightens noose on data security; asks payment banks to store user data only in India

• Why India's financial inclusion drive may be running out of steam

• Bharat Financial Inclusion looks to grow business in newer locations

• Fintech could give the world India's first tech giant

• Indian DFS landscape is changing: Insights from State of the Agent Network India, 2017 (ANA) Wave II

• India Needs More Women Business Correspondent Agents

• The Agent Profitability Conundrum in India – Time for Differentiated Agents?

• Measuring Women’s Financial Inclusion: The 2017 Findex Story

• Public Clearinghouse Could Shake Up China’s Mobile Payment Market

• Smartphones Are Common in Myanmar: Is Digital Finance Far Behind?

• 6 Ways Microfinance Institutions Can Adapt to the Digital Age

• Kenya’s Rules on Mobile Money Price Transparency Are Paying Off

• Moving beyond over-the-counter transactions

• P2G payments via mobile money: unlocking opportunity for consumers, governments and providers

• The Commonwealth Digital Identity Initiative

• New Insights on Women’s Mobile Phone Ownership, CGAP, April 2018

• Female Smallholders in the Financial Inclusion Agenda, CGAP, April 2018

• Assessment of Direct Benefit Transfer in Fertiliser, MicroSave, April 2018

• Lessons from Informal Financial Systems: An Indonesian Perspective, MicroSave, March 2018