NEW DELHI: India's poor need bank accounts and access to the financial system to help to sustain the country's surging economic growth, Finance Minister Pranab Mukherjee said Monday.
Mukherjee challenged banks and other businesses such as mobile phone firms to come up with innovative systems that would allow the Congress-led government to attain its aim of bringing the poor into mainstream banking.
"Financial inclusion is a necessary part of our growth process," Mukherjee told a conference in the capital on "financial inclusion" of India's hundreds of millions of poor.
"The entire economic system in our country needs to work together on this," Mukherjee said.
Analysts say that access to financial services is vital to ensure that the poor can take advantage of India's robust economic growth -- the country posted 8.6 percent expansion in the last financial quarter.
Less than half of India's 1.2 billion population has a bank account, with many forced to turn to unscrupulous money lenders who charge exorbitant interest rates to finance their needs.
The government has announced a monumental plan under which India's 1.2 billion people will each to receive their own identity number to improve the distribution of state benefits such as ration cards and easier access to the banking system.
Analysts say Indian banks could be able to tap into the country's 600 million-plus mobile phone network to help bring more people into the banking system through what is known as "branchless banking."
Mobile phones are used in other countries such as Kenya to assist in money transfers, set up savings accounts, make payments and perform other financial services.