India's Banking Revolution Has Left Its Villagers Behind
- Despite policy push, country lacks rural ATMs, bank branches
- Ahead of India’s general election, there’s rural frustration
Customers wait in line to withdraw money from a Central Bank of India branch in Dhadgaon village, Maharashtra, India, on Jan. 18, 2017.
Photographer: Dhiraj Singh/BloombergA shortage of bank branches and ATMs across India’s hinterland is holding back Prime Minister Narendra Modi’s financial inclusion efforts and risks angering rural voters ahead of elections next year.
After taking office in 2014, Modi set an ambitious target to open a bank account for every household to ensure welfare funds flow directly to India’s poor, while improving access to credit and insurance programs. He pushed policies that helped bring 310 million people into the formal banking system in just four years, according to the World Bank. But many of India’s villages still lack bank branches or ATMs to help service these new customers, while the pace of building new financial infrastructure has actually slowed.