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Miscellaneous·2019·Easy

India has banking correspondents, who help bring people in the hinterland into the banking fold. For them to succeed, banks cannot crimp on costs. They also cannot afford to ignore investing in financial education and literacy. Banking correspondents are way too small to be viewed as a systemic risk. Yet India's banking regulator has restricted them to serving only one bank, perhaps to prevent arbitrage.'Efforts at banking outreach may succeed only if there are better incentives at work for such last-mile workers and also those providers who ensure not just basic bank accounts but also products such as accident and life insurance and micro pension schemes. Which one of the following is the most logical, rational and crucial inference that can be derived from the above passage?

India has banking correspondents, who help bring people in the hinterland into the banking fold. For them to succeed, banks cannot crimp on costs. They also cannot afford to ignore investing in financial education and literacy. Banking correspondents are way too small to be viewed as a systemic risk. Yet India's banking regulator has restricted them to serving only one bank, perhaps to prevent arbitrage.'Efforts at banking outreach may succeed only if there are better incentives at work for such last-mile workers and also those providers who ensure not just basic bank accounts but also products such as accident and life insurance and micro pension schemes. Which one of the following is the most logical, rational and crucial inference that can be derived from the above passage?

Options

  1. a.

    Efforts to bring people in India's hinterland into the banking system are not successful.

  2. b.

    For meaningful financial inclusion, India's banking system needs more number of banking correspondents and other such last-mile workers.

  3. c.

    Meaningful financial inclusion in India requires that banking correspondents have diverse skills

  4. d.

    Better banking outreach would be impossible unless each banking correspondent is allowed to serve a number of banks

    Correct answer

Explanation

Answer is (d). Option (c) is evidently incorrect since the passage does not center on the skills of banking correspondents. Similarly, option (a) is inaccurate as the passage does not draw such a conclusion. Considering options (b) and (d), option (d) is more pertinent as it addresses the core issue under discussion.

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