The Challenge

Exclusion from the formal financial system keeps millions of Indians trapped in poverty. Although government programs have made it easier for households to open a bank account, many people still save money by storing cash or buying livestock, rely on payment couriers for transferring cash to friends and relatives, and turn to moneylenders when a crisis strikes. These informal methods are insecure, often inconvenient, and costly. Worst of all, when major problems arise, they are simply inadequate.


The Opportunity

India is the first country to implement a large-scale ecosystem for digital financial inclusion. Digital financial services offer a safe way for India’s poor people to save and transfer money and make payments. New policies are allowing for the creation of differentiated banks that offer more digital services than existing banks, and the new national ID cards are enabling direct distribution of subsidies and benefits.

Such a shift offers an unprecedented opportunity to develop scalable and cost-effective ways to reach all Indians with financial services such as digital savings, credit, insurance, and pensions—as well as ways to reduce fraud and inefficiencies and improve the impact of India’s anti-poverty programs. When poor households have access to these services, they can better plan their saving and spending and have a better chance of moving out of poverty, as well as absorb unexpected financial shocks.


Our Strategy

We support efforts by the Indian government to digitize government payments to poor households and encourage new digital banking models. We also work to identify gaps in digital financial inclusion efforts, and we work with private-sector providers to design digital financial products that meet the needs of poor households.