Category: Opinions

I read an excellent post by Ajay Shah recently that questioned the policy wisdom of emphasising house ownership over rental housing.

For every loan of Rs, 10,000 made through a Public Sector Bank rural branch, it costs them about Rs. 4150. The same number for a Private Sector Bank rural branch is about Rs. 3210. Little wonder then that rural branch expansion meets with so much resistance.

A few colleagues and I recently travelled through Varanasi and Mirzapur in Eastern Uttar Pradesh visiting Micro Finance Institutions (MFI) in that region and their clients. I am delighted to report that this region, one of the poorest in India, is a hotbed of innovations.

What does the asset allocation look like for people living in remote rural India (villages with less than 5000 population)?

What will it take to make payments universal in India with a ratio closer to one point for every 100 citizens and importantly, who will pay for creating this infrastructure?

There has been much discussion recently about the distorting nature of various indirect subsidies such as those being offered via price controls on fuel and fertiliser.

Every day, billions of low-income households all over the world are saving, borrowing and insuring in myriad ways, formal and informal.

Governments have proven to be too inefficient, the non-profits too small and the corporates too greedy to provide basic services. What about for-profit social enterprises?

Though India has deep financial infrastructure comprising a large number of bank and post-office branches; agricultural cooperative societies; and, now, micro finance institutions; there still remain gaps that have prevented us from leveraging the full potential of this financial infrastructure.

Finance Matters column in The Hindu Business Line – Farzana Najeeb of Advocacy writes the fifth article in the series.