To March 2010, about 50.6 million No Frills Accounts (NFAs), with an outstanding balance of Rs.53.86 million, were opened by banks. However, a significant number of new customers acquired by banks under the inclusion effort have remained dormant. This Note concludes that although there is high dormancy in the NFAs, these accounts represent a large potential client base. Banks need to work on designing innovative products, improved delivery mechanisms, and appropriate marketing and incentives for the BC model. Customers are willing to pay for the banking services offered by BCs and this user-friendly financial inclusion model can go a long way towards boosting the use of NFAs substantially.

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