rbi and govt initiative to fi

MUNAVVAR TK &

ANSIF EK

(FINAL BCOM)

Financial inclusion is the delivery of financial servicesat affordable costs to vast sections of disadvantagedand low income groups.

GOI (2008) defines Financial inclusion as the process ofensuring access to financial services and timelyand adequate credit where needed by vulnerable groupssuch as weaker sections and low income groupsat an affordable cost.

Even after 60 years of Independence a large section of Indian population Unbanked

The Reserve Bank of India (RBI) set up the Khan Commission in 2004 to look into financial inclusion

the term ‘financial inclusion’ was used for the first time in April 2005 in the annual Policy Statement presented by Y.Venugopal Reddy

Financial inclusion first featured in 2005, when it was introduced by K.C. Chakraborthy, the chairman of Indian Bank

Mangalam became the first village in India where all households were provided banking facilities.

WHY FINANCIAL INCLUSION IN INDIA IS IMPORTANT ?

Creating a platform for inculcating the habit of savings

Providing formal credit avenues

Plug gaps and leaks in public subsidies and welfare programs

Initiatives

No frill accounts

Khan commission report in 2004

Mid term review policy of RBI(2005-06)

Nil or very minimum balance to open an account

KISAN CREDIT CARD

Introduced in 1998

Focused on Rural Farmers

Credit Delivery Innovation

Simplifying the procedure for credit needs

Announced by Mr. Yaswanth Sinha, Finance Minister in his Budget speech

NABARD developed model kisan Credit card in 1998

Implemented commercial banks and regional rural banks in their respective areas of operations

Benefits of Kisan Credit cards

Simplified procedure

There is no need to apply for loan every years

helps to buy seeds, fertilizer and other inputs

Repayment is allowed after harvest period

It can withdraw money from any branch

Pradhan Manthri Jan Dhan Yojana (PMJDY)

National mission for financial inclusion

It is announced in 15 august 2014

First independence speech of Mr.Narendra Modi

Formally launched on 28 august 2014

Zero balance a/c at any branch

Special Benefits of PMJDY

Accidental insurance cover of Rs.1.00 lack

No minimum balance required.

Life insurance cover of Rs.30,000/-

Easy Transfer of money across India

After satisfactory operation of the account for 6 months, an overdraft facility will be permitted

Accidental Insurance Cover, RuPay Debit Card must be used at least once in 45 days.

Overdraft facility up to Rs.5000/- is available in only one account per household, preferably lady of the household.

Direct Benefit Transfer (DBT)

Direct Benefit Transfer/Electronic Benefit Transfer(DBT/EBT)

Launched in January 2013

Compels beneficiaries to open a bank a/c

To ensure money under various developmental schemes reaches beneficiaries directly

To avoid bureaucracy

Human less transfer of payment

Business Correspondents

Introduced in January 2006

provide banking facilities in unbanked rural facilities

Business correspondents provides affordability and easy accessibility of banks services

It provides door step delivery of banking services

Focus on cash in cash out transactions

Some other initiatives

Financial literacy program

Simplifies know your customer (KYC) norms and conditions

Financial literacy program

Opening of branches in unbanked rural area

Micro -finance