even among the old private banks all significant banks are listed. ( iv ) consolidation the process of consolidation has also been taking place in india. since 1990, 19 mergers have taken place in the commercial banking sector. bank mergers have taken place in india mostly with the objective to synergise the strength of the merging institutions. broad guidelines have been laid down by rbi for mergers for private sector banks from a regulatory and prudential perspective and these guidelines apply to public sector banks mutatis mutandis and to the extent relevant. ( v ) extension of coverage of reform process the reform process initially focused on commercial banks. however, after significant progress was made to transform commercial banks into sound institutions, the reform process was extended to encompass other institutions such as regional rural banks ( rrbs ), cooperative banks, all - india financial institutions ( aifis ) and non - banking financial companies ( nbfcs ). the regional rural banks, urban co - operative banks and rural co - operative credit institutions can play a major role in financial inclusion and deepening of the financial sector, particularly in the rural areas. the co - operative credit institutions, both urban and rural, are now placed on the path of revival through a consultative method of policy formulation, ensuring a workable regulatory arrangement to overcome the incentive problems and financial support wherever necessary. the strategy has started showing results which is crucial for sustaining their role in financial intermediation among the rural and urban poor and small savers. recent initiatives ( i ) supervision of financial conglomerates financial conglomerates ( fc ) pose certain risks to the financial system which could be detrimental to the overall financial stability. these risks relate to the moral hazard associated with the “ too - big - tofail ” position of many financial conglomerates, the fact that financial difficulties in one subsidiary in a segment could have contagion or reputation effects on another subsidiary in a different segment on account of the “ holding out ” phenomenon, especially when using the same brand name, and the concerns about regulatory arbitrage, non - arm ’ s length dealings, etc. arising out of intra - group transactions & exposures ( ites ) – both financial and non - financial. the financial sector in india has undergone significant liberalisation in all the four segments – banking, non - banking finance, securities and insurance and each of these sectors has grown significantly accompanied by a process of restructuring among the market intermediaries. the financial landscape is increasingly witnessing ( i ) entry of some

k c chakrabarty : financial inclusion of urban poor in india keynote address by dr k c chakrabarty, deputy governor of the reserve bank of india, at the annual national seminar titled “ financial inclusion of urban poor ” conducted by the american india foundation, new delhi, 28 january 2013. * * * assistance provided by smt. sushma vij in preparation of this address is gratefully acknowledged. ms. lata krishnan, chair, american india foundation ( aif ) ; mr. m. a. ravi kumar, ceo, aif ; prof. sanghmitra s. acharya, jawaharlal nehru university ; mr. pradeep kashyap, vice chair, aif ; mr. michael markels from the world bank ; ms. kavita n. ramdas, ms. madhu p. kishwar, mr. mathew titus and ms. sujata lamba, the panelists for today ’ s discussion, mr. hanumant rawat, director, aif ; delegates at the seminar, ladies and gentlemen. it is a pleasure to be here today at the fifth annual national seminar being conducted by the aif in new delhi. i am happy to see that dr. pradip sarmah from guwahati, who is a pioneer in the design of light weight rickshaws and organizing joint liability group for rickshaw pullers, is present here today. i am very glad to note that from a very humble beginning in 2001, aif has emerged as the leading non - profit organization in the country, involving indian - americans, dedicated not only to the task of upliftment of india ’ s poor but also to development of a vibrant social ecosystem. in collaboration with grassroot ngos and government agencies, aif has been successfully running several projects related to education, livelihood, and public health, with emphases on elementary education, women ’ s empowerment, and hiv / aids, respectively. i understand that aif has so far reached out to more than 1. 7 million of india ’ s less fortunate and successfully transformed their lives by providing them a sustainable means of livelihood. though on a standalone basis, number of lives touched by aif is very impressive, it simply dwarfs in comparison to the sheer enormity of the challenge that we, as a nation, face i. e. of reaching out to a population of 1. 2 billion. even to reach remotely