The RBI Annual Report FY 2025-26 places credit delivery and financial inclusion at the intersection of economic growth and inclusive development. During 2025-26, the Reserve Bank focused not merely on expanding access to banking services, but also on improving the usage, quality, affordability and reliability of financial services.
The year saw important developments in Priority Sector Lending (PSL), agricultural credit, Kisan Credit Cards, MSME finance, Business Correspondent outlets, digital financial inclusion, the Financial Inclusion Index, the Lead Bank Scheme, re-KYC, unclaimed deposits and financial literacy. Most importantly, the National Strategy for Financial Inclusion (NSFI): 2025-30 was launched with five strategic objectives and 47 action points.
For RBI Grade B Promotion Exam, Grade B, UPSC, IBPS and banking interviews, this chapter is particularly important because it connects RBI’s regulatory role with actual last-mile delivery of finance.
1. RBI’s Core Focus: From Banking Access to Effective Financial Inclusion
The RBI’s approach during 2025-26 had two closely connected objectives:
- Strengthen credit delivery, particularly to productive sectors.
- Deepen financial inclusion across different sections of society.
The Annual Report specifically highlights agriculture and micro and small enterprises (MSEs) as important beneficiaries of the credit-delivery framework.
The RBI also undertook initiatives involving:
- financial literacy;
- saturation of financial inclusion schemes;
- re-KYC;
- settlement of unclaimed funds;
- review of the Lead Bank Scheme;
- expansion and deepening of the digital payments ecosystem; and
- launch of NSFI 2025-30.
The important conceptual shift
Financial inclusion should not be understood simply as opening a bank account.
The RBI’s FI-Index itself captures three dimensions:
Access + Usage + Quality
This distinction is crucial for examinations.
2. Financial Inclusion Index: A Must-Remember RBI Indicator
The RBI’s Financial Inclusion Index (FI-Index) is a composite index designed to measure the extent of financial inclusion in India.
It incorporates three sub-indices:
| Dimension | Weight in FI-Index |
|---|---|
| Access | 35% |
| Usage | 45% |
| Quality | 20% |
| Total | 100% |
The index draws data from the banking, investment, insurance, postal and pension sectors.
FI-Index performance
The FI-Index increased from:
64.2 in March 2024 → 67.0 in March 2025
Thus, the index improved by 2.8 points.
The improvement was seen across all three dimensions, with usage and quality providing the major impetus. The RBI associated this with deeper financial inclusion and sustained financial literacy efforts.
Exam Point
Do not confuse:
- FI-Index → measures financial inclusion.
- Access, Usage and Quality → its three dimensions.
- NSFI 2025-30 → strategic framework for further strengthening financial inclusion.
3. Financial Inclusion at the Last Mile
The RBI’s monitoring data demonstrate the scale of India’s financial inclusion infrastructure.
As at December 2025:
- 1,70,189 banking outlets were manned by banks’ own staff.
- 11,75,250 fixed-point Business Correspondent (BC) outlets were reported.
- Total Basic Savings Bank Deposit Accounts (BSBDAs) stood at 7,304 lakh, or approximately 73.04 crore accounts.
- Female account holders numbered 4,024 lakh, approximately 40.24 crore.
- BSBDAs held deposits of ₹3,45,477 crore.
- Female account holders accounted for ₹2,06,095 crore of these balances.
This illustrates why the Business Correspondent model remains important: financial inclusion cannot depend exclusively on conventional bank branches.
Business Correspondents: Why They Matter
A Business Correspondent (BC) provides banking services closer to customers, particularly in locations where a conventional branch may not be commercially viable.
The December 2025 data recorded:
- 11.75 lakh fixed-point BC outlets;
- 39,413 lakh ICT-BC transactions;
- transaction value of approximately ₹11.90 lakh crore.
Female BC agents also played a significant role:
- 6,920 lakh transactions were undertaken by female BC agents;
- transaction value was ₹2,31,285 crore.
Important caution
The Annual Report notes that the number of BC outlets under the newer MPFI Return was lower than the figure reported earlier under the Financial Inclusion Plan return. This was attributed to revised reporting by one public sector bank and realignment of BC networks by some private sector banks. Therefore, the figures should not be interpreted mechanically as a sudden collapse in BC infrastructure.
4. Priority Sector Lending: Banks Continue to Cross the Minimum Target
Priority Sector Lending is one of the most important RBI instruments for directing institutional credit towards sectors considered important for inclusive economic development.
As on March 31, 2026, Scheduled Commercial Banks’ overall PSL stood at:
45.0%
of ANBC/CEOBSE, whichever was higher.
The prescribed overall PSL target was 40%, and each bank group achieved the prescribed target during 2025-26.
Bank-group-wise PSL achievement
| Bank group | PSL as % of relevant base, 2025-26 |
|---|---|
| Public Sector Banks | 42.8% |
| Private Sector Banks | 47.2% |
| Foreign Banks | 42.0% |
| Small Finance Banks | 78.8% |
| All SCBs | 45.0% |
The corresponding amount for all SCBs increased to ₹75.7 lakh crore, compared with ₹67.3 lakh crore in 2024-25.
Exam Trap
The figure 45% is the achievement reported for SCBs in 2025-26.
The prescribed overall target referred to in the Annual Report is 40%.
Therefore:
PSL achievement ≠ PSL target.
5. Agricultural Credit and Kisan Credit Card
The Kisan Credit Card (KCC) is designed as a single-window credit facility providing:
- working capital; and
- investment credit
to farmers for:
- cultivation;
- animal husbandry; and
- fisheries.
However, during 2025-26, the number of operative KCCs and outstanding amounts declined.
KCC position
| Indicator | 2024-25 | 2025-26* |
|---|---|---|
| Operative KCCs | 290.2 lakh | 256.2 lakh |
| Crop loan outstanding | ₹5,07,821 cr | ₹4,95,596 cr |
| Term loan outstanding | ₹55,047 cr | ₹39,352 cr |
| Animal husbandry & fisheries | ₹38,107 cr | ₹36,496 cr |
| Total outstanding | ₹6,00,975 cr | ₹5,71,444 cr |
*Provisional.
The number of operative KCCs declined by 11.7%, while outstanding amounts declined by 4.9%.
The Annual Report explains that the decline was primarily attributable to certain private sector banks reclassifying/declassifying exposures that were not aligned with the extant KCC guidelines.
Important development
The RBI undertook a comprehensive review of KCC guidelines to:
- expand coverage;
- streamline operations; and
- address emerging requirements.
Draft guidelines were issued for public comments.
6. MSME Credit: A Major Priority
Increasing credit flow to MSMEs remained a policy priority for both the RBI and the Government.
Outstanding SCB credit to MSMEs increased by 23.5% year-on-year as at end-December 2025.
The detailed data show:
| MSME segment | Credit outstanding, Dec. 2024 | Dec. 2025 |
|---|---|---|
| Micro enterprises | ₹14.4 lakh cr | ₹18.3 lakh cr |
| Small enterprises | ₹9.4 lakh cr | ₹11.5 lakh cr |
| Medium enterprises | ₹5.9 lakh cr | ₹6.9 lakh cr |
| Total MSMEs | ₹29.8 lakh cr | ₹36.8 lakh cr |
The number of MSME accounts stood at 234.7 lakh as at end-December 2025.
Collateral-Free Loans to MSEs
One of the important developments for the next financial year was the enhancement of the collateral-free loan limit for MSEs.
The limit was increased:
₹10 lakh → ₹20 lakh
effective April 1, 2026.
The stated objectives were to:
- improve access to formal credit;
- support entrepreneurship; and
- strengthen last-mile credit delivery for MSEs with limited collateral.
This is a highly probable examination fact because it combines date + amount + beneficiary + objective.
7. MSME Town Halls Become More Decentralised
RBI Regional Offices continued conducting MSME Town Hall meetings.
Their objectives included:
- engaging with MSMEs;
- increasing awareness of banking facilities; and
- addressing problems relating to access to formal finance.
The framework was revised to add:
District-level MSME SAMVAAD meetings
This provides a more granular outreach mechanism at the district and regional levels.
Why it matters
The change reflects a broader RBI approach:
National policy → regional implementation → district-level engagement → last-mile credit delivery.
8. Financial Inclusion Saturation Campaign and re-KYC
The RBI participated in a nationwide campaign led by the Department of Financial Services (DFS), Ministry of Finance, aimed at saturating financial inclusion schemes at the Gram Panchayat level.
The RBI expanded the campaign to include:
- re-KYC of accounts where KYC had become due;
- grievance redressal;
- awareness regarding unclaimed deposits.
A nationwide multimedia campaign was also undertaken to educate people about the importance of KYC updation.
This is significant because re-KYC was treated not simply as a compliance exercise but also as an opportunity for:
KYC compliance + customer awareness + grievance redressal + recovery of dormant/unclaimed money.
9. “Aapki Poonji, Aapka Adhikar” Campaign
The RBI participated in the nationwide campaign:
“Aapki Poonji, Aapka Adhikar”
(Your Money, Your Right)
The campaign was conducted during:
October–December 2025
Its objective was to facilitate:
- return of unclaimed deposits; and
- timely settlement of eligible claims from the Depositor Education and Awareness (DEA) Fund.
During the campaign:
₹2,876 crore
of unclaimed deposits were settled by public sector banks and regional rural banks.
Exam Point
Remember the combination:
Aapki Poonji, Aapka Adhikar → Oct-Dec 2025 → ₹2,876 crore settled.
10. Lead Bank Scheme: Comprehensive Review
The Lead Bank Scheme (LBS) was comprehensively reviewed during 2025-26.
The objective was to enhance its effectiveness in:
- deepening financial inclusion; and
- promoting credit flow to priority sectors.
Draft guidelines were published for public comments.
At present:
- 12 public sector banks
- and 2 private sector banks
had been assigned lead-bank responsibility, covering:
778 districts
The two private sector banks identified in the Annual Report are Jammu & Kashmir Bank and ICICI Bank.
11. EDDPE: Expanding Digital Financial Inclusion
The Expanding and Deepening of Digital Payments Ecosystem (EDDPE) programme is aimed at providing eligible individuals with at least one mode of digital payment.
Examples include:
- debit/RuPay cards;
- internet banking;
- mobile banking;
- UPI;
- USSD; and
- Aadhaar Enabled Payment System (AePS).
The programme had already been extended to all districts, except two districts of the Union Territory of Andaman & Nicobar Islands, in August 2023.
By:
March 31, 2026
100% coverage had been achieved in 710 districts, representing more than 80% of districts across India.
This included all districts in:
- 22 states, and
- 8 Union Territories.
2026-27 EDDPE Target
The RBI’s 2026-27 agenda is even more ambitious:
100% coverage in all identified districts by March 2027
under EDDPE, as part of Utkarsh 2029.
This creates a clear progression:
March 2026 → 710 districts covered at 100%
↓
March 2027 → 100% coverage in all identified districts
12. National Strategy for Financial Inclusion 2025-30
This is arguably the most important development of Part 12.
The National Strategy for Financial Inclusion (NSFI): 2025-30 was formally unveiled on:
December 1, 2025
by RBI Governor Sanjay Malhotra.
It was approved by the Sub-Committee of the Financial Stability and Development Council (FSDC-SC) at its 32nd meeting.
The strategy builds upon the previous NSFI 2019-24.
Its broad purpose is to establish a strategic pathway to address:
- demand-side impediments;
- supply-side impediments;
- weaknesses in the financial inclusion ecosystem;
while strengthening financial inclusion for people’s wellbeing.
13. Panch-Jyoti: Five Strategic Objectives of NSFI 2025-30
The NSFI 2025-30 contains:
5 strategic objectives
and
47 action points
These five objectives are called Panch-Jyoti.
1. Affordable and suitable financial services
Improve the availability and use of an:
- equitable;
- responsible;
- suitable; and
- affordable
bouquet of financial services to achieve financial safety and security for households and micro enterprises.
2. Gender-sensitive financial inclusion
Adopt a gender-sensitive approach towards women-led financial inclusion and differentiated strategies for improving the financial resilience of:
- households;
- underserved segments; and
- vulnerable groups.
3. Link financial inclusion with livelihoods and skills
Create stronger linkages between:
financial inclusion + livelihoods + skill development + support ecosystem.
4. Financial education
Use financial education as an instrument for promoting:
financial discipline.
5. Customer protection
Strengthen the:
- quality;
- reliability;
- customer protection; and
- grievance redressal
framework.
14. What Is the Strategic Shift Under NSFI 2025-30?
This is where candidates should move beyond rote learning.
The NSFI does not focus exclusively on opening more accounts.
Its emphasis is increasingly on:
Usage + Quality + Last-mile effectiveness
The strategy explicitly seeks to improve the usage and quality dimensions while simultaneously improving last-mile access and strengthening monitoring and measurement.
In practical terms:
Old approach:
Access to an account.
Stronger approach:
Access → actual usage → appropriate products → financial literacy → consumer protection → grievance redressal → financial resilience.
That is the conceptual direction of the NSFI 2025-30.
15. Who Will Implement NSFI 2025-30?
The strategy is not an RBI-only programme.
Action points and timelines are distributed among:
- RBI
- SEBI
- IRDAI
- PFRDA
- financial service providers;
- NABARD
- NSDC
- NCFE
under their respective jurisdictions.
The strategy was framed under the aegis of the:
Technical Group on Financial Inclusion and Financial Literacy (TGFIFL)
It followed nationwide stakeholder discussions and consultations involving the Department of Economic Affairs, Department of Financial Services, SEBI, IRDAI, PFRDA, NABARD, NSDC and NCFE.
Exam Point
If asked:
NSFI 2025-30 has how many strategic objectives and action points?
Answer:
5 strategic objectives (Panch-Jyoti) and 47 action points.
16. Financial Literacy Week 2026
The RBI’s annual Financial Literacy Week (FLW) was observed during:
February 9–13, 2026
The theme was:
“KYC – Your first step to safe banking”
The objective was to increase public awareness about:
- KYC; and
- account discipline.
The RBI undertook a centralised mass-media campaign through:
- television;
- radio;
- digital platforms; and
- outdoor hoardings.
Regional Offices also conducted localised campaigns, while banks were advised to create awareness among customers and the public.
KYC-related awareness messages were also covered in the Prime Minister’s Mann Ki Baat address on February 22, 2026.
17. Why Financial Literacy Is More Important Than Ever
The Annual Report’s treatment of financial literacy is revealing.
Financial inclusion can fail to achieve its purpose if individuals have access to accounts but lack the knowledge to:
- use financial products appropriately;
- maintain account discipline;
- complete KYC requirements;
- recognise risks;
- protect themselves from financial fraud;
- understand their rights; or
- seek grievance redressal.
That is why NSFI 2025-30 explicitly integrates financial literacy, consumer awareness and customer protection into the financial inclusion ecosystem.
18. The Complete Credit Delivery–Inclusion Chain
For examination purposes, the entire chapter can be remembered as one interconnected framework:
Priority Sector Lending
↓
Agriculture + MSMEs + other productive sectors
↓
KCC + MSME credit + collateral-free lending
↓
Bank branches + Business Correspondents
↓
Basic Savings Bank Deposit Accounts
↓
Digital payment access
↓
Financial literacy
↓
KYC/re-KYC + customer awareness
↓
Grievance redressal + unclaimed deposit settlement
↓
Consumer protection
↓
Deeper and higher-quality financial inclusion
This is much more useful than memorising isolated schemes.
19. RBI Annual Report FY 2025-26: Most Important Numbers from Part 12
| Topic | Key figure |
|---|---|
| FI-Index, March 2024 | 64.2 |
| FI-Index, March 2025 | 67.0 |
| FI-Index Access weight | 35% |
| FI-Index Usage weight | 45% |
| FI-Index Quality weight | 20% |
| SCB PSL achievement | 45.0% |
| Prescribed overall PSL target | 40% |
| PSL amount, 2025-26 | ₹75.7 lakh crore |
| Operative KCCs, 2025-26 | 256.2 lakh |
| KCC total outstanding | ₹5,71,444 crore |
| MSME credit growth | 23.5% y-o-y |
| MSME credit, Dec. 2025 | ₹36.8 lakh crore |
| Collateral-free MSE limit | ₹20 lakh |
| Effective date | April 1, 2026 |
| Unclaimed deposits settled | ₹2,876 crore |
| Lead Bank responsibility | 778 districts |
| Banking outlets—own staff | 1,70,189 |
| Fixed-point BC outlets | 11,75,250 |
| BSBDA accounts | 7,304 lakh |
| EDDPE 100% coverage | 710 districts |
| NSFI strategic objectives | 5 |
| NSFI action points | 47 |
| NSFI launch | December 1, 2025 |
| FLW 2026 | Feb. 9–13, 2026 |
| FLW 2026 theme | KYC – Your first step to safe banking |
Exam Point: The 10 Facts You Should Memorise First
1.
FI-Index = Access + Usage + Quality
2.
FI-Index rose from 64.2 to 67.0 between March 2024 and March 2025.
3.
FI-Index weights:
Access 35 : Usage 45 : Quality 20
4.
SCBs’ PSL achievement in March 2026:
45.0%
5.
Overall prescribed PSL target:
40%
6.
MSME credit growth:
23.5% y-o-y
7.
Collateral-free MSE loan limit:
₹20 lakh from April 1, 2026
8.
NSFI 2025-30:
5 Panch-Jyoti + 47 action points
9.
EDDPE:
710 districts with 100% coverage as on March 31, 2026
10.
Financial Literacy Week 2026:
Feb 9–13, 2026 — “KYC – Your first step to safe banking”
Key Takeaways
- The RBI’s FY 2025-26 approach linked credit delivery with financial inclusion.
- Agriculture and MSEs remained important areas of credit-delivery focus.
- SCBs achieved 45.0% PSL, above the prescribed 40% overall target.
- MSME credit grew 23.5% y-o-y as at end-December 2025.
- The collateral-free MSE loan limit was enhanced from ₹10 lakh to ₹20 lakh, effective April 1, 2026.
- The FI-Index increased from 64.2 to 67.0, with gains across access, usage and quality.
- EDDPE achieved 100% coverage in 710 districts by March 31, 2026.
- NSFI 2025-30 was launched on December 1, 2025.
- NSFI contains five Panch-Jyoti objectives and 47 action points.
- NSFI places greater emphasis on usage, quality, last-mile access, financial literacy and customer protection.
- The Aapki Poonji, Aapka Adhikar campaign settled ₹2,876 crore of unclaimed deposits.
- FLW 2026 focused on KYC and account discipline.
Final Exam Revision: Part 12 in 60 Seconds
Credit Delivery
→ PSL 45%
→ Target 40%
→ MSME credit growth 23.5%
→ MSE collateral-free limit ₹20 lakh
→ KCC operative accounts 256.2 lakh
Financial Inclusion
→ FI-Index 67.0
→ Previous 64.2
→ Access 35%
→ Usage 45%
→ Quality 20%
→ BC outlets 11.75 lakh
→ BSBDA 7,304 lakh
Digital Inclusion
→ EDDPE
→ 710 districts at 100% coverage
→ 2027 target: all identified districts
NSFI 2025-30
→ December 1, 2025
→ 5 Panch-Jyoti
→ 47 action points
→ Focus: access + usage + quality + literacy + protection
Financial Literacy
→ FLW 2026
→ Feb 9–13, 2026
→ Theme: “KYC – Your first step to safe banking”
Unclaimed Deposits
→ Aapki Poonji, Aapka Adhikar
→ Oct-Dec 2025
→ ₹2,876 crore settled
What This Means for the Exam
If you have limited time, prioritise NSFI 2025-30, FI-Index, PSL achievement, MSME credit, EDDPE, FLW 2026 and the ₹2,876 crore unclaimed-deposit settlement.
The highest-value conceptual question is likely to test whether you understand that financial inclusion is no longer merely about access. The RBI’s framework increasingly measures whether people actually use appropriate financial services, whether those services are of adequate quality, and whether customers are financially literate and protected.
Next Part
Part 13 — RBI Annual Report FY 2025-26: Financial Market Regulation and RBI Market Operations