India among top nations with most conducive environment for financial inclusion: Global Microscope report

In these countries, a range of providers are capable of providing digital financial services to people on the margins of the formal financial system, regulations control for some of the risks inherent in these services, and clear rules mark out spaces appropriate for innovation to achieve greater financial inclusion, the report said.

South Africa, India, Mexico, Tanzania and Uruguay were among the top countries that safeguard e-money via some sort of deposit insurance or protection.

This type of protection provides security to users of these new technologies, avoids creating regulatory imbalances between different types of institution, and ensures that digital financial inclusion does not place new consumers in the financial system at a disadvantage compared to those transacting with more traditional institutions, the report noted.

Additionally, these countries require financial institutions to maintain liability for the actions of their agents, ensuring that customers whose nearest access point is an agent do not receive less protection than customers who can visit a bank branch, it added.

In India, the Reserve Bank has prepared a draft National Strategy for Financial Inclusion to deepen financial services' coverage in the country.

The long-awaited strategy is expected to be finalised in 2019 and will cover a five-year period.

The RBI has set up a high-level committee to review the existing status of digitisation and devise a medium-term strategy for increasing digital payments, the report said.

In August 2019, the RBI released the Enabling Framework for Regulatory Sandbox (RS), which creates the basis for a regulatory sandbox that will allow fintech start-ups to live-test innovative products and services.