Financial Inclusion in

INDIA“ PMJDY:

A snapshot of the Reality

check. ”

Objective of the project

• The objective of the project is to access the Indian experience in the field of Financial Inclusion.• To study this Financial Inclusion

and how it works, a recent example has been taken which will also help to lower the unbanked population of the country.

Financial Inclusion before PMJDY

• In India, financial inclusion first featured in 2005, when it was introduced by K C Chakraborty, the chairman of Indian Bank.

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

• KYC Norms were relaxed for people intending to open accounts with annual deposits of less than Rs. 50,000.

• Census 2011 estimated that out of 24.67 crore households in the country, 14.48 crore (58.7%) households had access to banking services.

• Out of the 16.78 crore rural households, 9.14 crore (54.46%) were availing banking services.

• Out of the 7.89 crore urban households, 5.34 crore (67.68%) households were availing banking services.

Cont’d

Availability of Banking Services

National Level DataFor

PMJDY

After PMJDY S.No

No Of AccountsNo Of Rupa

y Debit Cards

Balance In Accounts

 % of Zero Balan

ce AccountsRural Urban Total

1 Public Sector Banks 6.87 5.73 12.59 11.75 1407

5.44 52.74

2 Private Banks 2.44 0.43 2.87 2.09 3186.83 52.96

3 Regional Rural Banks 0.4 0.28 0.67 0.59 1034.

51 49.25

Total 9.71 6.43 16.14 14.43 18296.78

52.60

Actual Scenario• After the interaction with the bank

officials, some basic problems and challenges came into focus.• Massive work load, Illiteracy of

customers and easy KYC norms are few to mention.• As shown in figures, the reality is

somewhat different.

Realistic ExperienceChallengesPercent %

Lack of Financial Literacy 60%Bulk Opening forms 30%Non availability of ID proof 10%

60%30%

10%

Lack of Financial Literacy

Bulk Opening forms

Non availability of ID proof

UBI SBI IDBI BOB PNB0

500

1000

1500

2000

2500

3000

3500 3082 3167

2064

2797

1596 No. of account

No.

of

Acco

unts

Bank UBI SBI IDBI BOB PNB

No. of account 3082

3167

2064

2797

1596

No. of accounts opened in last 6 months

Bank UBI SBI IDBI BOB PNBNo. of

account 326 900 2941322 480

Zero Balance Accounts

UBI SBI IDBI BOB PNB0

200

400

600

800

1000

1200

1400

326

900

294

1322

480No. of account

No.

of

Acco

unts

No. of Persons 12 22 6Awareness Yes No don’t Know

Awareness of PMJDY among customers

Yes No don’t Know0

5

10

15

20

25

12

22

6

Awareness of PMJDY

Awareness

No.

Of P

erso

ns

My Recommendations1. Financial Education-leads to-Financial Inclusion-leads to- Financial Stability.

2. Achieving number is not success, delivering promises is.

Conclusion• To sum up, financial inclusion is the

road that India needs to travel towards becoming a global player. Financial access will attract global market players to our country and that will result in increasing employment and business opportunities.

• Financial inclusion cannot be achieved only by meeting the target numbers. . The target is universality, not just speed and numbers.” The scheme can be a “waste” if it leads to duplication of accounts.

Noopur Srivastava

Intern, RPCD