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Ashok Kotwal
On demonetisation
Posted on: 23 Dec 2016
On the evening of 8 November, the Prime Minister announced on national television that Rs. ... read on »
A symposium on Piketty: Introduction
Posted on: 15 Jun 2015
Thomas Piketty’s book on ´Capital in the Twenty First Century’ has made waves. The f ... read on »
Emerging challenges: Economic and social
Posted on: 06 Aug 2014
To mark the second anniversary of I4I in July 2014, we invited two eminent scholars – Abhi ... read on »

Tag: banking

Demonetisation and agricultural markets
Nidhi Aggarwal , Sudha Narayanan
Posted on: 30 Nov 2016

In this article, Aggarwal and Narayanan contend that demonetisation alone cannot turn agricultural markets cashless. Such a shift would require sustained and focussed effort to expand the reach of formal institutions, especially for credit and storage.
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Demonetisation and rural cooperative banks
Ajay Vir Jakhar
Posted on: 22 Nov 2016

The RBI has barred rural cooperative banks from exchanging or accepting the denotified Rs. 1,000 and 500 notes. In this article, Ajay Vir Jakhar of Bharat Krishak Samaj - a non-partisan association of farmers - argues that if rural cooperative banks sink, so will farmers.
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Kisan Credit Card programme: Expanded access to credit or expansion of credit?
Somdeep Chatterjee
Posted on: 03 Nov 2016
Topics:   Finance , Agriculture


Kisan Credit Card programme - a key reform in agricultural lending in India - has been operational for almost 20 years now. However, there is little empirical evidence of its impact on intended beneficiaries. This column finds that the programme has had significant positive impact on agricultural production and technology adoption. It is likely that the channel is enhanced borrowing ability of the already unconstrained, rather than expanded access to credit.
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Recapitalising public sector banks by disinvesting in RBI: Right and wrong
Gurbachan Singh
Posted on: 09 May 2016

The Economic Survey 2015-16 put forth the argument that the Government of India could reduce its capital in the RBI from its current large level and use it to increase its capital in public sector banks, which face a capital shortage. RBI Governor Raghuram Rajan has stated that this argument is not valid. In this article, Prof. Gurbachan Singh contends that while the argument does not hold in general, it does so for all practical purposes under the present conditions.
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Achieving financial inclusion: Going cashless
Bappaditya Mukhopadhyay
Posted on: 06 Apr 2016
Topics:   Finance


A World Bank survey reveals that while about half of all individuals in India had bank accounts in 2014, only 12% had made a cashless transaction in the past year. In this article, Bappaditya Mukhopadhyay, Professor of Economics and Finance at the Great Lakes Institute of Management, contends that cashless transactions can be encouraged by ensuring that payments – beyond government transfers - are made directly into the bank accounts of recipients.
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How doorstep banking increased savings and income in Sri Lanka
Michael Callen , Suresh de Mel , Craig McIntosh , Christopher Woodruff
Posted on: 30 Mar 2016

Recent findings in development economics indicate that microloans are likely to perform best when accompanied by financial education, insurance, and savings products. This column presents evidence from an experiment in Sri Lanka, which involved offering saving accounts with door-to-door deposit collection services to otherwise unbanked rural households. It suggests that the programme incentivised participants to increase savings by increasing their income.
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Transforming Indian agriculture: The role of credit policy
Amartya Lahiri , Dilip Mookherjee
Posted on: 14 Dec 2015
Topics:   Finance , Agriculture


Despite various policy attempts at priority sector lending to poor farmers, very little progress has been made on the ground, suggesting problems in the design and implementation of these policies. In this article, Amartya Lahiri and Dilip Mookherjee and explore where the problem really lies and what can be done to address the issues.
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Are banks responsive to credit demand shocks in rural India?
Sankar De , Siddharth Vij
Posted on: 05 Oct 2015
Topics:   Finance


The output of Kharif crops is estimated to decrease by about 2% this year due to deficient monsoon rains in some Indian states. How responsive are commercial banks to a credit demand shock in rural India? Analysing data on rainfall and agricultural credit during 1993-2010, this column finds that banks increase the supply of agricultural credit to farmers following a drought, but that the additional credit is directed towards existing customers.
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Emergence of Bandhan as a bank: A new era in the Indian banking industry
Somdutta Basu , Souvik Dutta , Abhirup Sarkar
Posted on: 27 Aug 2015
Topics:   Finance


At a time when the Indian banking industry is experiencing a steep rise in bad loans, Bandhan – an MFI with a near 100% loan recovery rate – has converted into a bank. Based on a survey of 112 Bandhan clients in West Bengal, this column highlights the features of Bandhan’s lending model that have enabled it to keep its bad loans at negligible levels.
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How interest rates affect financial decisions of Indian households
Nikhil Gupta
Posted on: 17 Jul 2015

RBI has cut interest rates three times this year so far. While rate cuts are welcomed by the Indian corporate sector, their impact on households is less discussed. This column analyses the relationship between deposit rates and financial decisions of households. It finds that lower rates reduce net financial savings of households, which in turn reduces the resource pool available to the corporate sector.
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Barriers to basic banking in India
Camille Boudot , A.J. Mowl
Posted on: 29 May 2015
Topics:   Finance


The Indian government is promoting the Jan Dhan Yojana, Aadhaar and mobile banking – or the “JAM trinity” — as the pathway to financial inclusion. But are banks capable or even willing take on their role in this ambitious agenda? Based on a field study in Chennai, this column highlights the range of costs and constraints imposed by banks on customers attempting to enter the formal financial sector.
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Can bank account-based payments boost savings?
Vincent Somville , Lore Vandewalle
Posted on: 06 Apr 2015
Topics:   Finance


?The Finance Ministry plans to focus on mobilising savings in the next phase of PMJDY, the financial inclusion scheme. This column presents results from an experiment in Chhattisgarh, which tests whether the method of payment of wages and other transfers affects household finances. It finds that people that are paid through their bank account save more than those that are paid in cash.
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