When Sanjay lost his job in a private company during the Covid-led lockdown, he thought of starting his own venture to make silver ornaments. His relatives were already settled in the business and assured to help him. When he went to banks for loans, he was told that getting a loan in the name of his wife under government schemes would be easier. The trick worked as Sanjay is about to start his business while his wife remains a silent observer. However, Sanjay feels that there is no need for his wife to be part of financial inclusion or reap benefits of other government schemes like health insurance.

The government has launched schemes for financial inclusion and entrepreneurship development of people across the country including that of women. However, data shows that women participation is low in life insurance and pension schemes, but when it comes to schemes where loans could be availed, the number of women participants shows a steep rise.

According to the World Bank, financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit and insurance – delivered in a responsible and sustainable way.


Loan-related schemes

“It is a fact that men avail loans in the name of women members in their families and that’s why the number could be high in schemes related to loans or financial assistance. In many rural areas, it is men who run the show in the name of women,” says Smita Dombale, an entrepreneur.

Pradhan Mantri Jan-Dhan Yojana (PMJDY) is a national mission for financial inclusion to ensure access to financial services, including basic savings and deposit accounts, remittance, credit, insurance, pension in an affordable manner. Data show that of the total accounts opened under PMJDY, 55 per cent are in the name of women. According to the Ministry of Rural Development, 20.64 crore women PMJDY account holders were benefited through the ex-gratia payment under Pradhan Mantri Garib Kalyan Yojana.

The other two loan-related schemes have witnessed the highest women participation. Pradhan Mantri Mudra Yojana (PMMY), launched in 2015, provides loans up to ₹10 lakh to non-corporate, non-farm small/micro-enterprises. These loans are classified as MUDRA loans under PMMY. Of the total beneficiaries, 68 per cent of loan borrowers are women.

Stand-Up India (SUPI), launched in 2016 to promote entrepreneurship at the grass-root level for economic empowerment and job creation, seeks to leverage the institutional credit structure to reach out to the under-served sector of people such as Scheduled Caste, Scheduled Tribe and women entrepreneurs. The scheme facilitates bank loans between ₹10 lakh and ₹1 crore to at least one Scheduled Caste (SC) or Scheduled Tribe (ST) borrower and at least one woman borrower per bank branch of Scheduled Commercial Bank for setting up a Greenfield enterprise. 82 per cent of the total accounts in this scheme are in the names of women entrepreneurs.

While the government is taking efforts to popularise the schemes launched after 2014, Rashtriya Mahila Kosh (RMK), established in 1993 under the aegis of the Ministry of Women and Child Development, for socio-economic empowerment of women remains neglected. Very few women beneficiaries have taken loans under this scheme ( see graphics).

Insurance schemes

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) was launched in 2015 with an objective to create a social security system for the poor and underprivileged in the age group of 18-50 years by providing a renewable life insurance cover of ₹2 lakh with just a premium of ₹330. However, only 27 per cent of people who opted for insurance are women.

Pradhan Mantri Suraksha Bima Yojana (PMSBY) provides an affordable insurance scheme for the poor and underprivileged people in the age group of 18 to 70 years with a bank account at a premium of ₹12 per annum. Risk coverage of ₹2 lakh for accidental death and full disability and ₹1 lakh for partial disability is given under the scheme. Of the total people who opted for the scheme, only 37 per cent are women.

Atal Pension Yojana (APY) envisages a universal social security system for all Indians, especially the poor and the under-privilege by offering a guaranteed minimum monthly pension of ₹1,000-₹5,000 at the age of 60 years. Even in this scheme participation of women is 44 per cent.

“This reflects the mindset of the society where men are considered breadwinners and only they need insurance cover,” says Vijayalaxmi Bhosale, a domestic worker.

Employment schemes

Of the 3,17,653 micro enterprises set up since 2015-16 about 1,03,754 (33 per cent) are in the name of women under the Prime Minister’s Employment Generation Programme (PMEGP), which is a major scheme of MSME. The scheme facilitates the generation of self-employment opportunities through the establishment of micro-enterprises in the non-farm sector by helping traditional artisans and unemployed youth.

The Ministry of Rural Development runs Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY) which is a placement-linked skill development programme for wage employment. Since 2015-16 till date 4,65,152 women were trained and 60 per cent of them have found placement.

Under the skill development through Rural Self Employment and Training Institutes (RSETIs) enabling a trainee to take bank credit and start his/her own micro-enterprise 4,65,152 women are being trained.

Why the financial inclusion of women is must

“There has been growing evidence on how financial inclusion has a multiplier effect in boosting overall economic output, reducing poverty and income inequality at the national level. Financial inclusion of women is particularly important for gender equality and women’s economic empowerment,” states the RBI’s National Strategy for Financial Inclusion (NSFI).

With greater control over their financial lives, women can help themselves and their families to come out of poverty; reduce their risk of falling into poverty; eliminate their exploitation from the informal sector; and increase their ability to fully engage in measurable and productive economic activities.

“An inclusive financial system supports stability, integrity and equitable growth. Therefore, financial exclusion because of several barriers like physical, socio-cultural and psychological, warrants attention from the policy makers,” NSFI adds.

The data show that gender bias towards the role of women in financial matters is one of the reasons for the involuntary financial exclusion of women.


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