Financial education acts as a catalyst for economic inclusion and is the cornerstone of economic, social, and emotional security. The Financial Inclusion Index (FI Index) of the Reserve Bank of India has significantly improved, rising to 60.1% in March 2023 as opposed to 56.4 in that year. The Prime Minister’s Jan Dhan Yojana (PMJDY), a ground-breaking program aimed at common banks access by granting zero-balance bank records to vulnerable communities, has made an important contribution to this advancement. Over 50 million people are now part of the formal banking system thanks to it.
By November 2023 (as of November 30), the number of bank balances under PMJDY has significantly increased from 14.72 billion in March 2015 to 50.99 million.
These accounts have received about 34.63 million RuPay cards with built-in accident insurance coverage for 2 million.
PMJDY has facilitated income-generating activities and increased ownership of financial assets among women, with 55.5 percent of accounts opened by women and 67% in rural/semi-urban areas. The accounts are now essential to the implementation of people-centric programs like Direct Benefits Transfer (DBT).
Additionally, PMJDY contributes to the inclusive growth of rural and underprivileged areas by providing life and accident coverage through programs like the Pradhan Mantri Jeevan Jyoti Yojana (PMJJBY) and PRDhan Mentri Suraksha Bima Yojna. The widespread use of PMJDY records is closely related to the success of UPI and online transactions.
To put joint banks on an equal footing with professional banks, NABARD was a pioneer in promoting the adoption of technology. Since 2012, it has been crucial in advancing cooperative banks’ technical and financial support for the development of reliable Core Banking Solutions (CBS) systems.
These banks will receive IT safety, fraud management, cyber security operations centers, and various technological upgrades as a result of this initiative.
Financial Acumen
Through programs like economic and electronic literacy camps held in remote areas, NABARD promotes economic addition. Micro-ATMs, point-of-sale (POS) systems, kiosk banking locations, BHIM app integration, the Bharat Bill Payment System ( BBPS), and public financial management system (PFMS) are all supported. The Centre for Financial Literacy (CFL) program is being implemented across the nation as part of the RBI’s National Strategy for Financial Inclusion (NSFI- 2019-24), with a goal of one CFL per 2 to 3 blocks.
There are now 1,600 Lights in use across the country. The BharatNet initiative, a massive undertaking by the government of India, is addressing remote accessibility issues. With the installation of 668,144 miles of optical fiber wire, 761,312 fiber-to-the-home connections, and 104,675 Wi-Fi hotspots, this initiative has so far connected as many as 348 Gram Panchayats. Banking contacts are receiving network help as well.
The FI Index has been trending upward. The index is anticipated to continue rising as a result of ongoing efforts, reflecting increased economic participation in remote areas.
The author is Chief General Manager at Mumbai-basedNABARD. Opinions are individual.