Financial Inclusion


  • 21 crore account opened under JDY so far
  • Around 94.4% households had saving bank accounts in 2015-16 : Labour Bureau
Critically comment on the recent initiatives taken by the government to improve financial inclusion and the challenges these initiatives face in reaching out to the poor and needy. (200 Words)
Kick starting virtuous growth cycle, govt. has taken many steps to bring the unbanked population into the fold of financial markets.
These steps are:
  1. PMJDY with overdraft facility and accident insurance
  2. Payment Banks and private bank licenses by RBI
  3. Thrust on m-banking by PSBs
  4. Banking Correspondents and branchless banking
  5. Clubbing various social security schemes like PM Suraksha Bima Yojana into bank accounts
Challenges before these initiatives
  1. Many newly opened accounts have remained dormant
  2. Economic viability of payments banks has to be monitored regularly; managing partnership with main banks will be a challenge for them
  3. Technology penetration and its accessibility is an issue in rural areas. NOFN project is running behind timelines
  4. Illiteracy and lack of financial awareness leads to rural population being hesitant to transact via bank accounts.
  5. Inability to transact due to network/service downtime
  6. Complex user interfaces and inadequate grievance redressal mechanisms
  7. Non-transparent fees and other terms; Business correspondents have been accused of siphoning off money
  8. Fraud that targets customers, inadequate data privacy and protection
Govt. has to take into account all such bottlenecks while monitoring the schemes of financial inclusion and ensure that inclusion of underprivileged genuinely benefits them while improving government’s delivery mechanisms



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