In addition, credit growth has been strong – roughly 5% recently – and the credit-to-GDP gap has been closing quickly (Figure 2). • Overvaluation of collateral: The growth rate of loans to domestic households for house purchase has risen continuously since 2010 (Figure 3). Prices for residential real estate have been rising rapidly in recent years (Figure 4).
The RBI defines Financial Inclusion as the “process of ensuring access to appropriate financial products and services needed by all sections of the society in general and vulnerable groups such as weaker sections and low income groups in particular, at an affordable cost in a fair and transparent manner by regulated, mainstream institutional players”.