Modi has rejuvenated the poor class in India through financial inclusion

On August 15, 2014, the Prime Minister of India, Narendra Modi, announced the ‘Pradhan Mantri Jan Dhan Yojana’ from the ramparts of the Red Fort and without losing time, this scheme was started across the country from August 28, 2014. This decision taken by the Central Government had changed the condition and direction of the economy sector in the country. The second edition of this scheme was launched in the year 2018 adding more benefits. In this second edition, instead of every family, it was announced to connect every person with banking services who were deprived of banking facilities. The result of this initiative is in front of all of us today that the country has progressed so far on the path of economic development that the whole world is considering India as a shining star on the global economic front.

The economic development of any country also depends on the financial services of the citizens of that country. The more population is connected with financial services, the stronger will be the economic condition of that country. However, since independence, a large section of the population in India and the low income section of the society have been deprived of a large number of financial services. While financial inclusion is considered a key enabler in reducing poverty. In the year 2014, crores of citizens of the country had a mobile phone but they did not have a savings account in the bank. Citizens were afraid to go to the bank. In order to empower the citizens financially, there was a need for such a plan so that all the citizens could reap the benefits and ensure their participation in the development of India. Therefore, the Pradhan Mantri Jan Dhan Yojana was started by the Central Government to make the citizens financially empowered. This has led to rapid growth in the Indian economy in general and banking services in particular in recent times.

Through Pradhan Mantri Jan Dhan Yojana, savings accounts were opened in banks for common citizens, availability of need-based loans was ensured, money remittance facility, insurance and pension facility were also made available. Interest is earned on the deposits under this scheme, although it is not necessary to keep any minimum amount in the savings account. Accident insurance up to Rs 1 lakh is also available. Also, through this scheme, life insurance of two lakh rupees is given to that beneficiary on his death on normal terms. The facility of transfer of benefits given through government schemes is also available under this scheme.

Pradhan Mantri Jan Dhan Yojana in India has connected every poor citizen of the country to the financial mainstream. The poorest people sitting at the last end of the society have also got the benefit of this scheme. Even after almost 70 years of independence, 50 percent of the citizens of India were not connected to the backbone of the economy ie banks. Under this scheme, till March 31, 2023, 48.65 crore savings accounts have been opened in various banks. Also, an amount of more than Rs 2 lakh crore has been deposited in these deposit accounts by these account holders. A large number of citizens have also taken advantage of the other facilities provided to the account holders under the Pradhan Mantri Jan Dhan Yojana. 15.99 crore citizens have joined the Pradhan Mantri Jeevan Jyoti Bima Yojana, 49 percent of whom are women, under this scheme life insurance of Rs 2 lakh is provided at an annual premium of only Rs 436. 33.78 crore citizens have joined the Pradhan Mantri Suraksha Bima Yojana, of which 48 percent are women beneficiaries, under this scheme, accidental insurance of Rs 2 lakh is provided at an annual premium of only Rs 20. 5.20 crore citizens have joined the Atal Pension Yojana. Loans have been provided to 40.83 crore citizens under Mudra Yojana.

Pradhan Mantri Jan Dhan Yojana is being considered as a revolutionary step for financial inclusion since its inception. After the launch of this scheme, the number of accounts opened in the bank within a week was included in the Guinness Book of World Records as an achievement. With the help of banks, savings accounts of crores of citizens have been opened in various banks with zero balance. About 67 percent of these savings accounts have been opened in rural and semi-urban centres, which is seen as a growing rural economy.

With the aim of simplifying the banking system in India, the work of promoting Digital India has also been done successfully. RuPay Debit Card has been provided to the savings account holders opened under this scheme. This RuPay card user can be used for transacting at all ATMs, POS terminals and e-commerce websites. In the year 2016, 15.78 crore savings account holders were given RuPay cards and by April 2023 this number has increased to 33.5 crore.

At present, 6.55 lakh Banking Mitras are also providing their services with the aim of making banking services easy in the country. The figures related to the above schemes show how banking services have been brought to the doorsteps of the citizens. For financial inclusion, the target that was set to connect at least one member of the poor to middle income family from rural to urban to banking service has been achieved to a large extent during the last 8 years.

Financial inclusion is acting as a major factor in reducing poverty. Since the implementation of the Pradhan Mantri Jan Dhan Yojana, there has been rapid progress in banking services among the poor sections of the country. Financial inclusion has also become a major driver of economic growth and poverty alleviation. The number of savings accounts has tripled during the last 8 years. Prime Minister Narendra Modi thinks that no person in the country should be deprived of financial and banking services, for this purpose this scheme was started. Financial inclusion enhances financial literacy and consumer protection. Also, financial inclusion also increases the rate of capital formation in the country.

Through financial inclusion, efforts are being made to make every family as well as every citizen of the country capable enough to contribute meaningfully to the economic progress of the country. Not some members of the family but all the members of the family should come out of the poverty line. The entire society and all the regions of the country should become economically developed. All the societies of the country are being taken forward without any discrimination. Financial inclusion has completely changed the economic landscape of the country today. Today instant payment of money online has become possible through UPI and now money is deposited in the bank and they also earn income in the form of interest. Earlier, this amount was lying at home and remained an unproductive asset.

Today, in the field of financial inclusion, many countries of the world have started looking at India as an example of how a country with a population of more than 140 crores has connected even those citizens with banks who were hitherto deprived of these facilities. Unless there is inclusive development, the economic development of the country also cannot pick up pace. Earlier, where people were afraid to go to banks, now banking facilities are being provided to them sitting at home through bank friends. Today citizens do not need to go to the bank, online banking transactions are being done easily. Overall, there has been an incomparable change in the banking sector in India, due to which financial inclusion has also become very easy in the country.

– Prahlad Sabnani

retired deputy general manager

state Bank of India