siliconindia | | June 202019THE FINANCIAL INCLUSION SCENARIO IN INDIABy SEEMA PREM, CEO of FIA Technology Services Private Ltd. (FIA Global)triving to get rid of bar-riers that exclude people from the formal econo-my ­especially those caused by social fac-tors such as net worth, income, or occupation ­financial in-clusion refers to the efforts taken to make financial services and products accessible to all. This inclusiveness works towards ensuring that anyone can participate in the financial sector, regardless of their financial status, and improve their lives with the help of useful and affordable products and services that help meet their financial needs. It works towards reducing the gap be-tween the rich and the poor by bring-ing financial services to the masses, particularly the underprivileged and those residing in remote areas.About 2.7 billion people around the world keep their hard-earned money in their pockets or hidden away at home. In India alone, there are 395 million people who have no bank accounts. Financial inclusion plays a vital role in the elimination of poverty in India and the rest of the world.The first step to financial inclu-sion is having access to a transaction account that helps one store money as well as send and receive payment. Besides this, an account functions as a gateway that grants individuals ac-cess to financial services. The Current Scenario in IndiaIndia has a vast majority of its pop-ulation living in rural areas. These people do not have easy access to finance facilities. Only 38 percent of the scheduled commercial banks have branches in these remote loca-tions and over two-thirds of the un-banked populace are women. Of the financially excluded popu-lation that has opened bank accounts in the country, less than 30 percent are operational. Financial inclusion ini-tiatives focus on providing economic security to individuals and families of the underprivileged communities. Very often, these communities have no access to banks and financial ser-vices in the form of savings accounts, term deposits, loans, insurance, and remittance facilities.Over the years, banks have ex-panded their presence in these areas by opening new rural branches, set-ting up ATMs and digital kiosks, pro-viding credit through General Credit Cards (GCC) and Kisan Credit Cards (KCC), deploying banking corre-spondents, etc. With the introduction of technol-ogy in core banking and a rapid in-crease in alternative channels for de-livery, inclusion is being effected on a large scale. Over the past seven years, considerable progress has been made, with the number of rural branches ris-ing from 33,000 to over 50,000, and basic savings accounts from 73 mil-lion to a staggering 533 million. And deposits in these accounts shot up from Rs 55 billion to Rs 977 billion! All of this happened between 2010 and 2017, according to the An-nual Report of the RBI (2016-17). The biggest factor was the Pradhan-Mantri Jan DhanYojana (PMJDY), which was rolled out in 2014. De-signed to enable access of financial services to the deprived, PMJDY has seen phenomenal results since its in-ception. According to a May 2018 report, over 316 million new savings accounts were opened, Rs 800 billion accumulated in deposits, and over 200 million debit cards issued. Financial inclusion schemes got a notable boost through PMJDY and also came under the focus of the RBI. This focus and acceleration in financial inclusion is expected to be immensely beneficial for the people and prove widely successful in the coming years. The role of Technology Rapid advancements in technol-ogy have helped the banking sec-tor take swifter strides. The RBI is focused on (and is actively in-SCXO INSIGHTSInvolved in social services, Seema has been focuses on the impact of technology on social innovation.
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