swaminathan j : reaching the unreached – ensuring last mile connectivity of banking services keynote address by mr swaminathan j, deputy governor of the reserve bank of india, at the conference of lead district managers and district development managers, hubballi, 20 september 2024. * * * regional director of rbi for karnataka, smt. sonali sen gupta ; chief general manager, nabard, shri kvsslv prasada rao ; chief general manager, canara bank and convenor, slbc karnataka, shri k. j. shrikanth ; area heads of union bank of india and bank of baroda, senior executives from banks ; lead district managers ( ldms ) ; district development managers ( ddms ) ; ldos and other officers of rbi, present here. ellarigu namaskara and a very good morning to all. let me begin by complimenting bengaluru regional office of the reserve bank of india for organising this conference with an apt theme - reaching the unreached – ensuring last mile connectivity of banking services. the theme reminds us that financial inclusion is an ongoing journey. while significant progress has been made in this journey, there is still some distance to be traversed. i must also thank the bengaluru regional office for selecting this place, hubballi, for this conference, a place where i served as a young officer of state bank of india, some thirty years ago – which brings back lots of nostalgic memories of the basic banking that we used to do over three decades ago. india's journey towards inclusive development after independence has been marked by several initiatives aimed at reducing poverty and improving living standards. measures like expanding access to essential services such as education, healthcare and sanitation, and creating productive employment opportunities for all sections of the population have seen tremendous progress. ensuring that the benefits of economic growth are shared by all segments of society, including marginalised groups has been the cornerstone of these initiatives. it has been a multifaceted journey with significant achievements in terms of economic growth, poverty alleviation, improvements in education and health care, etc. in the relatively early days of this journey, the lead bank scheme was institutionalised in 1969 and since then the scheme has served as an important tool in enhancing credit flow to the sectors that have been identified as national priority and to the underserved population of the country, boosting economic growth at all levels, e. g., block level, district level and state level. over more

the reforms in the aftermath of the financial crisis, too. the latest balance sheet data show that banks have good capital bases and good levels of liquidity. i see no reason for major concern at the moment. nevertheless, the tightening of monetary policy presents challenges for banks. weaknesses in supervision and regulation can be made apparent or even become problematic. in addition, more recent developments need to be taken into account. for instance, the interplay between digital banking and social networks can increase the speed of a bank run – a large - scale withdrawal of deposits. central banks and financial supervisory authorities are constantly monitoring the situation. the eurosystem's monetary policy toolkit is very well equipped to provide sufficient liquidity in an emergency and to ensure smooth transmission. 3. 3 a broad - based approach to stability ladies and gentlemen, central banks have an established place in the economic system. they provide support by ensuring price stability. at the same time, they can fulfil their roles as anchors more effectively or more easily if other institutions " join in " – especially economic policymakers. a broad - based approach to stability should cover many areas. i will begin by briefly touching on the core area of fiscal policy and then discuss the labour market as an example. markus brunnermeier recently said : " many politicians continue to think that the central bank can reduce inflation on its own. yet it is not as simple as that. cooperation from the government is needed. the fight between central banks and governments will intensify ". 7 i hope, of course, that this prediction does not come true. 7 / 9 bis - central bankers'speeches in the current environment, it is important that the stance of fiscal policy does not make the tasks of monetary policy more difficult. thus, germany and the other euro area countries should allow the broad - based crisis assistance to be phased out in a timely manner. in this context, it would not be advisable to extend the energy price brakes beyond the end of this year. limiting budget deficits is also sensible in order to remain capable of action in a new crisis situation. ultimately, it is important that fiscal policy offers reliable prospects of sound public finances. in this regard, the european commission's recent proposals for reforming the eu's fiscal rules seem unhelpful, as the binding effect of the rules would probably be weaker. 8 the same rules would no longer apply to all member states. instead, the european commission would negotiate – on a