A panel, set up by the Reserve Bank of India, has suggested offering simple and customised financial products to encourage households to enter the formal financial markets. These include assets, liabilities, insurance, and savings, the bank’s Report of the Household Finance Committee said, Hindu Business Line reported.

The committee, headed by Tarun Ramadorai of Imperial College Business School, suggested creating a default opt-out structure.

The panel made sector-specific recommendations and compiled an essential kit for households to gain adequate benefits from the formal financial markets. The committee also stressed the need to incorporate technology for transaction cost cuts including using electronic forms for Know Your Customer compliance.

It has suggested that new technology initiatives be introduced in a phased manner through a regulatory sandbox, which allows for field testing to collect evidence.

The “essential kit” aims to serve as a checklist for households, the report said. It recommends flexible fixed deposit accounts, micro-pensions with flexible dates of pay, simple term life insurance and basic health insurance.