GII Booklet Series PART III: Target Demographics

The GII Booklet Series supplements each lecture by providing additional information and insight into the topic of financial inclusion. We strongly encourage you to look into the topics presented in both the lectures and

printed booklet to engage with this material between GII sessions.

GII Lecture # 3 Speaker

Mr. Bryan Devries

VP Mortgages, ICICI Bank Mr. Bryan Devries serves as Vice President of Mortgages at ICICI Bank Canada Ltd. Mr. Devries has been actively involved in the residential mortgage industry for over 20 years. Mr. Devries served as Vice President of Broker Lending of MCAN Mortgage Corp. and was responsible for sales, underwriting, and the funding of residential mortgages. Mr. Devries has forged strong relationships with a full range of mortgage industry players, including brokers, lenders, insurers and other service providers. He served progressive management roles specifically in broker lending and the operations to support broker channel business.

Mr. Devries serves as Chairman of the Education Committee and a Member of the government relations and communications committees of the Canadian Association of Accredited Mortgage. Professionals (CAAMP). Mr. Devries is an advocate for enhanced industry standards through his involvement in CAAMP. In 2002, he was the recipient of the Michael Ellenzweig Award for outstanding service to the mortgage industry, for his work in the area of education. He holds the Accredited Mortgage Professional (AMP) designation.

With a portfolio of Rs.9.6 billion and a client base of 3.5 million, ICICI Bank's micro finance programme is one of the largest among private sector banks in India. Our micro finance portfolio scaled up rapidly with the use of an innovative financing structure, the "Partnership Model" (described under the section on innovations). The key social benefit resulting from this financing structure has been the rapid scale-up of the operations of smaller MFIs in India at a time when most of the industry faced severe capital constraints.

India’s Demographic Bonus India is currently experiencing a period of demographic bonus. A demographic bonus is a dividend enjoyed by a country as a result of the proportion of people in the productive age group (15-64 years old) being very high, as part of the country’s population evolution. The demographic window is open for less developed countries, providing exciting opportunities for economic growth. Financial inclusion is an essential component of enabling the developing world to maximize its demographic dividends.

Geographically, low levels of financial inclusion are present in the North-Eastern and Eastern parts of India. The number of savings accounts for these regions is significantly lower than India’s national average.

Age & Financial Inclusion in India

The Urban/Rural Divide Out of the 203 million households in India, it is estimated that 147 million households are located in rural areas. Farmer households have been an important segment for financial inclusion initiatives as they represent more than half of the rural population. Approximately 73% of farmers do not have access to formal sources of credit.

The Rich-Poor Divide

The gap between rich and poor is growing in India. According to a UN-ESCAP report, there has been an increase in income inequality. The Gini coefficient- a measure of income inequality- increased in India from 30.8 to 33.9 in India.

While much of India’s financial inclusion initiatives have focused on rural communities, the urban poor also lack access to basic financial services. Migrant workers, who have travelled from rural areas to cities like New Delhi and Mumbai, are a particularly important segment. These labourers often have outstanding loans back home and access to remittance services is important to them. However, the critical challenge for migrant workers is having proper documentation as the nature of their work prevents them from having references, contacts, and other documents that could verify their identity.

India’s Rural Population (1967 to Present)

30% Urban

70% Rural

India's Urban/Rural Divide

India’s Gender Ratio There are 37 million more men than women in India, and most of them are of marriageable age given the relatively young population. Women are a particularly vulnerable segment of the population. While many women are in charge of managing the household finances, they often do not have access to formal banking services. Mobile banking solutions do not necessarily address this issue. Less than half as of Indian women use a mobile phone due to cost or cultural issues.  

The World Bank reports that only 26% of Indian women over the age of 15 have an account at a formal financial institution.

1. Global Findex: Only global demand-side data source that allows for global and regional cross-country analysis

2. The FinScope Survey: Data source that measures financial inclusion indicators at a sub-national level

3. FinAccess/Access to Financial Services Surveys

4. Financial Inclusion Tracker Surveys (FITS): collect trend data about

households’ financial behavior over time

5. Financial Inclusion Insight Surveys (FII): delivered by the Bill and Melinda Gates Foundation in partnership with Intermedia

6. The IMF Financial Access Survey (FAS): one of the main data sources for the

G20 Financial Inclusion Indicators

7. GSMA Mobile Money Adoption Survey: to give managers of mobile money deployments better insights into the performance of their service relative to each other

8. World Bank’s Global Payment Survey: carried out in 139 countries

9. MIX’s Geospatial Maps: premier source of public information on

microfinance institutions (MFIs 10. Fspmaps.com: provides analytical tools to answer several financial access

questions

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February Issue of the GII Booklet Series Featuring:

The Human Side of Financial Inclusion