Scope of financial inclusion not limited to banking services: Meghwal

Scope of the financial inclusion is not limited to only banking services, but also extends to other financial services such as insurance, equity products and pension products, Minister of State for Finance and Corporate Affairs, Arjun Ram Meghwal, has said.

In an article penned by him on “Financial Inclusion in Rising India” the Minister said: “Thus, financial inclusion is not just about opening a simple bank account with a branch in an unbanked area.”

The government is committed to its target of increasing the inclusion of every household in the financial system so that the masses can get all the legitimate benefits, and the funds mobilised from the people not earlier in the formal channel could also be brought in the formal channel, he wrote adding that “thereby giving the economy of the country an extra thrust to lead the path of growth.”

Lack of financial inclusion is costly to society and the individual, he opined adding that, “As far as the individual is concerned, lack of financial inclusion forces the unbanked into informal banking sectors where interest rates are higher and the amount of available funds much smaller. Because the informal banking structure is outside any legislative framework, any dispute between lenders and borrowers cannot be settled legally.”

As far as the social benefits are concerned, according to Meghwal, financial inclusion increases the amount of available savings, increases efficiency of financial intermediation, and allows for tapping new business opportunities.

Financial inclusion also helps the government plug gaps and leakages in public subsidies and welfare programmes, he wrote. “In fact, the government has even saved more than ₹57,000 crore in its subsidy bill and has ensured that the benefit of the subsidy reaches to the real beneficiary directly to him/her.”

One of the most crucial of the several steps taken by this government is JAM- Jan Dhan, Aadhar & Mobile. In order to provide social security system for all citizens and especially to the poor and under-privileged people, the government launched Pradhan Mantri Suraksha Bima Yojna and Pradhan Mantri Jeevan Jyoti Bima Yojna. Then there is Atal Pension Yojna, Varishita Pension Bima Yojana, Pradhan Mantri Mudra Yojna.

Other Schemes includes Jeevan Suraksha Bandhan Yojana, Sukanya Samriddhi Yojana: Kisan Credit Cards (KCC) and General Credit Cards (GCC), BHIM App. The Minister also elaborated on various other schemes and programmes initiated by the government.