Principal Secretary to Prime Minister Narendra Modi, PK Mishra, on Saturday cautioned that financial systems must remain connected to the real economy and the everyday lives of citizens, warning against risks from excessive speculation and market instability, as reported by ANI.
Addressing the 20th convocation ceremony of the National Institute of Bank Management (NIBM) in Pune, Mishra emphasized that financial systems should not drift away from productive economic activity. He stated, "Financial systems cannot become disconnected from the real economy and lives of ordinary citizens. Excessive speculation, irresponsible lending, unsustainable leverage, and instability in financial markets can create disruptions."
Simultaneously, Mishra highlighted the role of India's digital public infrastructure in transforming financial inclusion and expanding access to banking, digital payments, and formal credit. He said, "In India, this convergence of finance and technology has enabled the creation of one of the world's most ambitious and inclusive digital public infrastructures."
Mishra referred to the JAM trinity—Jan Dhan accounts, Aadhaar, and mobile connectivity—that has significantly reshaped the reach of India's banking ecosystem. "The Pradhan Mantri Jan Dhan Yojana brought crores of unbanked citizens into the formal banking system. Aadhaar created a verifiable digital identity architecture at an unprecedented scale. Mobile connectivity provided the final layer of access," he explained.
Discussing India's digital payment ecosystem, Mishra highlighted the rapid growth of the Unified Payments Interface (UPI), describing it as one of the world's largest real-time payment systems. "In less than a decade, India has built the world's largest real-time digital payment ecosystem. From just 2 crore transactions in 2016-17, UPI now processes over 25,000 crore transactions annually," he noted.
Mishra stated that one of the biggest achievements of the digital payments revolution was expanding access to formal finance across both rural and urban India. "A small tea seller in a village or a professional in a metropolitan city can today transact through the same interoperable digital payment infrastructure," he said.
He also observed that digital transaction records are increasingly creating formal credit histories for individuals who previously lacked collateral or banking relationships. "Every payment made, every purchase recorded, every transfer completed, leaves behind a data trail. That data trail over time can become the basis for a credit history for those who have no formal credit record, no collateral to offer, and no prior relationship with the bank," Mishra said.
Emphasizing the broader objective of financial inclusion, he stressed that access to financial services should ultimately translate into economic opportunities. "True inclusion must ultimately create productive economic opportunities," he said.
Highlighting the government's Mudra scheme, Mishra noted that over 57 crore loans worth around Rs 40 lakh crore have been sanctioned to micro, small, and medium enterprises, benefiting a large number of women and people from marginalized communities. "Behind every Mudra loan lies a human story: a tailoring business expanded, a small workshop modernized, a transport vehicle purchased, a family enterprise stabilized, and a first business opportunity created," he concluded.
