question that arises from these data patterns : is this because people can ’ t access banks or other service providers or because they don ’ t see value in doing so? this question needs to be addressed if an effective inclusion strategy is to be developed. the second message is that the process of financial inclusion is going to be incomplete and inadequate if it is measured only in terms of new accounts being opened and operated. from the employment and earnings patterns, there emerged a sense that better access to various kinds of financial services would help to increase the livelihood potential of a number of occupational categories, which in turn would help reduce the income differentials between these and more regular, salaried jobs. the fact that a huge proportion of the indian workforce is either self - employed or in the casual labour segment suggests the need for products that will make access to credit easier to the former, while offering opportunities for risk mitigation and consumption smoothing to the latter. bis central bankers ’ speeches the third message emerges from the analysis of expenditure patterns is the significance of infrequent, but quantitatively significant expenditures like ceremonies and medical costs. essentially, dealing with these kinds of expenditures requires either low - cost insurance options, supported by a correspondingly low - cost health care system or a low level systematic investment plan, which allows even poor households to create enough of a buffer to deal with these demands as and when they arise. as has already been pointed out, it is not as though such products are not being offered by domestic financial service providers. it is really a matter of extending them to make them accessible to a very large number of lower income households, with a low and possibly uncertain ability to maintain regular contributions. the fourth message comes strongly from the motivations to both save and borrow, which, as one might reasonably expect, significantly overlap with each other. it is striking that the need to deal with emergencies, both financial and medical, plays such an important role in both sets of motivations. the latter is, as has been said, amenable to a low - cost, mass insurance scheme, with the attendant service provision. however, the former, which is a theme that recurs through the entire discussion on consumer characteristics, certainly suggests that the need for some kind of income and consumption smoothing product is a significant one in an effective financial inclusion agenda. this, of course, raises broader questions about the role of social safety nets, which offer at least some minimum income security and consumption smoothing. how extensive these mechanisms

of services, even exceeding the outstanding external debt amounting to $ 72. 5 billion as of end - june 2017. we also have in place substantial regional safety net arrangements. the banking system is strong and stable. banks are lending more, and to productive sectors. outstanding loans of universal and commercial banks as of end - september 2017 are up by 21. 1 percent year - on - year. but the non - performing loans ( npl ) ratio stood at a mere 1. 4 percent. as of end - june 2017, the capital adequacy ratio stood 16. 0 percent on consolidated basis, double the international minimum. our comprehensive risk - based supervision approach ensure that our banks operate in a safe and sound manner and that the economy is guarded against shocks that may affect financial sector stability. because of bold reforms, the banking system today is very different from the banking system before the asian financial crisis. 1 / 4 bis central bankers'speeches nevertheless, there are those who raise overheating concerns. some also worry of a potential asset bubble in the real estate sector. our data and analysis suggest otherwise. and we are vigilant to avoid these risks. the credit - togdp ratio of 63. 6 percent as of q2 2017 is still one of the lowest by far in asia, indicating relatively low overall leverage. at any rate, regulations are in place that require banks to manage their exposures to the real estate sector. last september, the monetary board approved enhancements to bank reportorial requirements on exposures to the real estate sector and to infrastructure projects. more granular information are to be submitted for the bsp to better monitor the extent of bank exposure to real estate and infrastructure projects. we are ready to implement appropriate macro - prudential measures as the situation may require. another concern being raised is the country ’ s current account balance which, after posting 13 consecutive years ( 2003 – 2015 ) of surplus, turned into a small deficit in 2016 ( - 0. 3 % of gdp ) and in 2017 ( - 0. 2 % of gdp in jan - june ). this concern is misplaced. indeed, imf observed that previous current account surpluses actually reflected low levels of investment. behind the deficit is the economy ’ s rapid growth, backed by rising investments. there is an increase in imports of machineries, capital goods, intermediate goods and raw materials. eventually, we expect these to translate into higher productivity and exports, lending support to the sustainability