A Report on Financial Inclusion in India Through Prdhan Mantri - Jan dhan Yojna

Honorable Prime Minister, Narendra Modi on 15 August, 2014 announced "Pradhan Mantri Jan-
Dhan Yojana" which is a National Mission for Financial Inclusion. The task is huge and is a
National Priority. This National Mission on Financial Inclusion has an determined objective of
covering all households in the country with banking facilities and having a bank account for each
household. It has been emphasized by the Honorable PM that this is important for including people
left-out into the mainstream of the financial system.

The Pradhan Mantri Jan-Dhan Yojana was launched on 28 August, 2014, across the nation at the
same time. It will be launched formally in Delhi with similar functions at the state level and also at
district and sub-district levels. Camps are also to be organized at the branch level. The Pradhan
Mantri Jan-Dhan Yojana lies at the core of development philosophy of "Sab Ka Sath Sab Ka Vikas".

With a bank account, every household would gain access to banking and credit facilities. This will
allow them to come out of the grip of moneylenders, manage to keep away from financial crises
caused by emergent needs, and most importantly, benefit from a range of financial products. As a
first step, every account holder gets a RuPay debit card with a 1,00,000/- accident cover. Further,
they will be covered by insurance and pension products. There is need to join over 7.5cr households
and open their accounts.

Before efforts by the Government of India include setting up a committee on financial inclusion
under the chairmanship of Dr. C. Rangarajan. The committee confirmed its report in early 2008. As
is evident from the preface of the report, the committee understood financial inclusion as an
instrument for social transformation. Access to finance by the poor and weak groups is a essential
for inclusive growth. In fact, providing access to finance is a form of empowerment of the weak
groups. Financial Inclusion represents delivery of financial services at an affordable cost to the vast
sections of the disadvantaged and low-income groups. The various financial services included
credit, savings, insurance and payments facilities. The objective of financial inclusion is to cover the
scope of activities of the organized financial system to include within its ambit people with low
incomes. Through graduated credit, the attempt must be to lift the poor from one level to another so
that they come out of poverty.

Financial Inclusion - Background:

Financial inclusion means the delivery of basic financial services (banking services) to every
section of the society at affordable prices.

Offering affordable financial services to the disadvantaged and low-income segments of

society is the key objective of financial inclusion.

The efforts to include the financially excepted segments of the society into formal financial system
in India are not new. The concept was first proposed by the Reserve Bank of India in 2005 and
Branchless Banking through Banking Agents called Bank Mitr was started in the year 2006. In the
year 2011, the Government of India gave a serious impulsion to the programme by undertaking the
"Swabhimaan" campaign to cover over 74,000 villages, with population more than 2,000 with
banking facilities. State wise number of villages covered under the campaign.
 Pre- Jan Dhan status of financial inclusion in the country:
Census, 2011 estimated that out of 24.67 crore households in the country, 14.48 crore
(58.7%) households had access to banking services. Of the 16.78 crore rural households,
9.14 crore (54.46%) were availing banking services. Of the 7.89 crore urban households,
5.34 crore (67.68%) households were availing banking services.
In the year 2011, Banks covered 74,351 villages, with population more than 2,000 with
banking facilities under the Swabhimaan campaign with Business Correspondent,
however the program had a very limited reach and impact.
The present banking network of the country comprises of a bank branch network of
1,33,429. Of these, 50,702 branches are in rural areas. As on 30.06.2016, there are 2,01,182
ATMs network across the country. Moreover, more than 1.25 lakh Business Correspondents
(BCs) of Public Sector Banks, Regional Rural Banks and Private Sector Banks have been
deployed in rural Sub Service Areas (SSAs)/ urban wards.

Need for Financial Inclusion

Inculcating the Savings Habits:

Lack of savings makes the poor and low income people a vulnerable class so that they have to often
live under the financial stress. Expansion of banking facilities in these unbanked areas will inculcate
saving habits among the rural people. As savings of the rural and semi-rural people is mobilized by
commercial, cooperative and rural banks, capital formation in the country is bound to increase. In
this way, financial inclusion creates a platform for cultivating the habit to save and also to
channelizing the savings.

Providing Banking Credit:

In the absence of banking facilities in rural areas, farmers, rural people are vulnerably dependent on
informal sources of credit like friends, relatives and moneylenders. Poverty and indebtedness
sometimes lead to farmers suicides especially in rain fed areas. Formal banking system provides
adequate, transparent and low cost credit to farmers and rural people. Thus, supply of bank credit
not only relieve the farmers from the clutches of money lenders, but also boost the output, income
and prosperity of all the people living in rural areas. Micro finance is the recent example to provide
easy, adequate and affordable credit to the vulnerable sections of the society.

Direct Cash Transfer to Beneficiaries Accounts:

Government gives subsidies to farmers, consumers and weaker sections on food, fertilizers, and
LPG gas. However, a considerable amount of money kept for giving the subsidy for the poorest
people hardly reach them due to leakages and corruption at different levels in government
bureaucracy. To avoid this, government has decided to make direct cash transfers to beneficiaries
through their bank accounts. The intention of the government is to ensure transparency, eliminate
corruption, reduce expenditure on subsidy, and provide subsidy to the real beneficiaries.
 Timeline for Financial Inclusion Plan:

Comprehensive Financial Inclusion of the excluded sections is proposed to be achieved by 14

August, 2018 in two phases as Follows:

Phase I (15 Aug, 2014 - 14 Aug, 2015):

Universal access to banking facilities in all areas except areas with infrastructure and
connectivity constrains like parts of North East, Himachal Pradesh, Uttarakhand, J&K and
82 Left Wing Extremism districts.
Providing Basic Banking Accounts and RuPay Debit card which has inbuilt accident
insurance cover of ` 1 lakh. Aadhaar number will be seeded to make account ready for DBT
payment.
Financial Literacy Programme

Phase II (15 Aug, 2015 - 14 Aug, 2018):

Overdraft facility up to ` 5000/- after six months of satisfactory operation / history
Creation of Credit Guarantee Fund for coverage of defaults in A/Cs with overdraft limit up to
5,000.
Micro Insurance.
Unorganized sector Pension schemes like Swavalamban.

TIMELINE FOR IMPLEMENTATION

S.No Activities Timeline

1 Launch 28/08/2014
2 Coverage of SSAs (opening of 50,000 Bank Mitr
outlet in rural areas and
additional ones as necessary in Urban areas)
10,000 15/08/2014
15,000 (Aggregate 25,000) 30/11/2014
15,000 (Aggregate 25,000) 31/03/2015
10,000 (Aggregate 50,000) 30/06/2015
3 Opening of accounts (estimated at 7.5 crore)
25% 30/11/2014

50% 31/03/2015

75% 30/06/2015

100% 14/08/2015
 Importance of Financial Inclusion:
Efficiency in public service delivery:

Efficiency in public service is the key to narrow down poverty and establish
an egalitarian society.

Financial inclusion also creates awareness towards social security

schemes related to pensions, rural employment etc.

Financial Inclusion will improve efficiency in public service delivery by trickling

down the public funds such as subsidies, pensions etc. through direct transfers to the intended
ones

Formal channels of credit:

Financial Inclusion has the potential to liberate the poor from the clutches
of moneylenders by catering to their affordable credit requirements.

Economic progress in Rural areas:

Financial inclusion is key to generating employment in rural areas. Financial inclusion

combined with Digital Inclusion has the potential to change the face of rural India.

Reduce the threat of Black Money:

Not having a bank account = No ATM, Net Banking = People transact using hard cash =
Good market for Fake Currency.

FI will improve the state of financial literacy and banking awareness in India.

Alternate Investment Options

Financial inclusion creates awareness regarding Alternate Investment Options like mutual
funds, insurance schemes, government securities and other such investment options.

Key to Inflation Targeting

Alternate Investment Options make inflation targeting easy as banks will have to greatly
depend on the money from RBI

Inflation targeting is done by controlling the flow of money in the economy.

RBI uses Repo rate, reverse repo rate and other monetary policy tools to control the money
flow in the economy.

Due to poor financial inclusion, banks, in the short term, insulate themselves from the impact
of RBIs monetary policy changes.

This makes inflation targeting a hard task for the RBI.

 Financial Inclusion in India Background:

The efforts to include the financially excluded segments of the society into formal financial system
in India are not new. The concept was first mooted by the Reserve Bank of India in 2005 and
Branchless Banking through Banking Agents called Bank Mitr was started in the year 2006. In
the year 2011, the Government of India gave a serious push to the Programme by undertaking the
"Swabhimaan" campaign to cover over 74,000 villages, with population more than 2,000 (as per
2001 census, with banking facilities. Because of the RBIs drive for financial inclusion, the number
of bank accounts increased by about 100 million during 2011-13.
The Swabhimaan campaign, however, was limited in its approach in terms of reach and coverage.
Convergence of various aspects of comprehensive Financial Inclusion like opening of bank
accounts, digital access to money (receipt/credit of money through electronic payment channels),
availing of micro credit, insurance and pension was lacking. The campaign focused only on the
supply side by providing banking facility in villages of population greater than 2000 but the entire
geography was not targeted. There was no focus on the households. Also some technology issues
hampered further scalability of the campaign. Consequently the desired benefits could not be
achieved and a large number of bank accounts remained dormant.

Efforts Towards Financial Inclusion:

Nationalization Of Banks:

Indira Gandhis move to nationalize 14 banks in 1969 is one major shot at improving
Financial Inclusion.

Positives Of Financial Inclusion

Bank nationalization saw a huge expansion in branches into the hinterland.

It improved formal credit system and reduced the influence of moneylenders.

It benefited the economy.

Negatives Of Financial Inclusion

Investments in branches and the servicing of millions of small accounts pushed up

operational costs in nationalized banks.

Combined with bad loans, the investment resulted in the net worth of public sector banks
turning negative by the early 1990s
 Financial Inclusion: Current Status:
Data from Census, 2011 estimates that only 58.7 percent of the households have access to banking
services. The present banking network of the country comprises of a bank branch network of
1,15,082 and an ATM network of 1,60,055. Of these, 43,962 branches and 23,334 ATMs are in rural
areas. According to World Bank Findex Survey a only 35 percent of Indian adults had access to a
formal bank account and 8 percent borrowed from a formal financial institution in last 12 months.
Access to formal financial institutions has improved gradually but thousands of villages still lack a
bank branch; less than 10 percent of all commercial bank credit goes to rural areas, where around 70
per cent of the total population lives. Data from the RBI show that only 46,126 out of 640,867
villages in India were covered by banks in March 2014. Thus the need for financial inclusion is
beyond question.

Overview and Progress on Financial Inclusion:

Position of households availing banking services

As per Census 2001 As per Census 2011

Number of Number of
Households Total number
households households
of households
availing Percent availing Number Percent
banking banking
services services

Rural 138,271,559 41,639,949 30.1 167,826,730 91,369,805 54.4

Urban 53,692,376 26,590,693 49.5 78,865,937 53,444,983 67.8

Total 191,963,935 68,230,642 35.5 246,692,667 144,814,788 58.7

Population Group wise number of branches of Scheduled Commercial Banks (SCBs):

Rural Semi Urban Urban Metropolitan Total

As on

31.03.2011 33923 23089 17629 16255 90896

31.03.2012 36546 25834 18879 17274 98533

31.03.2013 39816 28546 19935 18092 106389

31.03.2014 45293 31530 21532 19275 117630

 31.03.2015 48557 33766 23036 20498 125857

Bank Group and Population Group wise Number of Functioning Branches As on March 31,
2015

Bank Group Rural Semi Urban Urban Metropolitan Total

SBI & its Associates 8029 6593 4304 3622 22548

Nationalised Banks 21228 16428 12604 11325 61585

Other Public Sector Banks 377 528 479 378 1762

Private Sector Banks 4302 6457 4521 4698 19978

Foreign Banks 8 12 57 247 324

Regional Rural Banks 14613 3748 1071 228 19660

Grand Total 48557 33766 23036 20498 125857

Position of ATMs deployed by PSBs and SCBs during the last five years:

As on Off-site ATMs On-site ATMs Total ATMs

31.03.2011 20032 30201 50233

31.03.2012 24181 34012 58193

31.03.2013 29411 40241 69652

31.03.2014 44504 65920 110424

31.03.2015 58763 69902 128665

30.06.2015 59245 71979 131224

 Report on OVERDRAFT (Sanctioned/Disbursed) under PMJDY December 2016
Tot No Tot No Tot No Amt. Tot
Accounts Accounts Accounts OD
Bank Name
Offered For OD Availed (In
OD Sanctioned OD Availed Lacs)

Allahabad Bank 236266 123865 58189 1447.39

Andhra Bank 176563 176563 13056 173.61

Axis Bank Ltd 9482 51 22 0.21

Bank of Baroda 583614 560867 92277 2089.95

Bank of India 125783 125783 43211 1390.03

Bank of Maharashtra 251015 6350 6350 44.08

Bhartiya Mahila Bank 6530 0 0 0.00

Canara Bank 452957 435575 429966 6877.35

Central Bank of India 942694 918862 318998 935.31

City Union Bank Ltd 25 25 3 0.10

Corporation Bank 36635 1163 1120 27.97

Dena Bank 165626 45924 42654 383.47

Federal Bank Ltd 0 0 0 0.00

HDFC Bank Ltd 37196 214 214 8.62

ICICI Bank Ltd 6103 391 391 3.86

IDBI Bank Ltd. 24691 24687 430 8.19

Indian Bank 218070 212700 101457 1828.23

Indian Overseas Bank 161159 10949 10949 121.61

IndusInd Bank Ltd 257 0 0 0.00

Jammu & Kashmir Bank
Ltd 93393 237 237 11.26
Karur Vysya Bank Ltd 1 0 0 0.00

Kotak Mahindra Bank Ltd 0 0 0 0.00

Lakshmi Vilas Bank Ltd 0 0 0 0.00

Oriental Bank of
Commerce 101995 24516 3642 50.25

Punjab & Sind Bank 154359 79002 78783 1254.90

Punjab National Bank 726636 560652 502257 7978.08

Ratnakar Bank Ltd 0 0 0 0.00

South Indian Bank Ltd 0 0 0 0.00

State Bank of Bikaner &
Jaipur 103644 11435 11435 421.75

State Bank of Hyderabad 192178 26531 26531 400.72

119533
State Bank of India 1 826185 546979 3370.35

State Bank of Mysore 12011 12011 5195 106.99

State Bank of Patiala 77975 4741 4739 110.84

State Bank of Travancore 58004 5453 5453 104.92

Syndicate Bank 403532 161013 60327 1277.67

UCO Bank 184725 27643 4032 130.96

Union Bank of India 483770 40444 11433 231.82

108381
United Bank of India 3 38689 38689 1104.21

Vijaya Bank 50248 6056 6056 107.58

Yes Bank Ltd 0 0 0 0.00

835628
Grand Total 1 4468577 2425075 32002.28
 PMJDY DETAILS

Pradhan Mantri Jan-Dhan Yojana (PMJDY) is National Mission for Financial Inclusion to ensure
access to financial services, namely, Banking/ Savings & Deposit Accounts, Remittance, Credit,
Insurance, Pension in an affordable manner.

Account can be opened in any bank branch or Business Correspondent (Bank Mitr) outlet.
PMJDY accounts are being opened with Zero balance. However, if the account-holder wishes to
get cheque book, he/she will have to fulfill minimum balance criteria.

Document required to open an account under Pradhan Mantri Jan-Dhan Yojana

An account can be opened by presenting an officially valid document.

The passport
The driving licence
The Permanent Account Number Card
The Voters Identity Card issued by Election Commission of India
Job card issued by NREGA duly signed by an officer of the State Government
the letter issued by the Unique Identification Authority of India containing details of
name, address and Aadhaar number
Any other document as notified by the Central Government in consultation with the
Regulate
Identity card with applicant's Photograph issued by Central/State Government
Departments, Statutory/Regulatory Authorities, Public Sector Undertakings, Scheduled
Commercial Banks, and Public Financial Institutions;
Letter issued by a Gazetted officer, with a duly attested photograph of the person.

Reserve Bank of India vide its Press Release dated 26.08.2014, has further clarified that those
persons who do not have any of the officially valid documents can open Small Accounts with
banks. A Small Account can be opened on the basis of a self-attested photograph and putting
his/her signatures or thumb print in the presence of officials of the bank. Such accounts have
limitations regarding the aggregate credits (not more than Rupees one lakh in a year), aggregate
withdrawals (nor more than Rupees ten thousand in a month) and balance in the accounts (not
more than Rupees fifty thousand at any point of time). These accounts would be valid normally
for a period of twelve months. Thereafter, such accounts would be allowed to continue for a
 further period of twelve more months, if the account-holder provides a document showing that
he/she has applied for any of the Officially Valid Document, within 12 months of opening the
small account.

Special Benefits Under PMJDY Scheme

1. Interest on deposit.

2. Accidental insurance cover of Rs. 1 lac

3. No minimum balance required.

4. The scheme provide life cover of Rs. 30,000/- payable on death of the beneficiary,
subject to fulfillment of the eligibility condition.

5. Easy Transfer of money across India

6. Beneficiaries of Government Schemes will get Direct Benefit Transfer in these accounts.

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

8. Access to Pension, insurance products.

9. The Claim under Personal Accidental Insurance under PMJDY shall be payable if the
Rupay Card holder have performed minimum one successful financial or non-financial customer
induced transaction at any Bank Branch, Bank Mitra, ATM, POS, E-COM etc. Channel both
Intra and Inter-bank i.e. on-us off-us within 90 days prior to date of accident including accident
date will be included as eligible transactions under the Rupay Insurance Program 2016-2017.

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

Salient Features and Basic Pillars of PMJDY

Universal Access to Banking Facilities

The first basic pillar of the PMJDY is to provide access to banking facilities and services to
ensure financial inclusion of hitherto neglected segment of the society. All the more than 6 lakh
villages in the country are to be organised into Sub Service Areas and allocate to banks. Banks
are required to provide one fixed point banking outlet as a either branch or Business
Correspondent to cater services to 1000 to 1500 households. Besides, Mobile Telephone services
would be effectively utilized to deepen financial inclusion.

Mobile BCs covers only bigger villages, while fixed point BCs ensures uniform access and
uniform coverage. All the villages and habitations in the country will get access to banking
services within a short distance of 5 kms. Some parts of J&K, H.P., Uttarakhand, North East and
82 Naxalists affected districts are now excluded from this plan due to constraints of
infrastructure and telecom connectivity but these areas are to be covered by August 2016.

Providing Basic Banking Accounts

Total households in India are 24.67 crore out of which 14,48 crore households have access to
banking services. About 13.14 crore rural households are allotted to PSBs and RRBs out of
which 7.22 crore households have been provided banking services till march 2014. These banks
have to achieve the target of opening of 7.5 crore new bank accounts, comprising 6 crore rural
and 1.5 crore urban uncovered households, by March 2015. The target may not be achieved in
difficult area where connectivity constraints are existed. To achieve this target, camp approach,
modern technology, e-KYC, Aadhar numbers and call centres, etc, will be efficiently used.
Accounts of SHGs and Joint Liability Groups will also be opened. The National Payments
Corporation of India recently launched Indigenous debit card called as RuPay Debit Card which
is Indias own card system. Further, the Kisan Credit Card is also to be provided with the RuPay
Card. This card covers an accidental insurance benefits of Rs. 1 lakh and life insurance of Rs.
30,000.

Financial Literacy

Before implementing any programme like micro finance and SHGs, it is necessary to create
awareness among the people about the benefits of formal financial system, banks, savings, credit,
timely repayment of loans and other services. About 718 Financial Literacy Centres have been
setup and 2.2 million people have received the benefits of awareness camps, seminars and
lectures during 2012-13. However, such type of FLCs have not been established in rural areas. It
is, therefore, proposed to set up FLCs at the block / taluka level and financial literacy cells will
be created in all rural bank branches.

It is also planned to make a convergence with the National Rural Livelihood Mission and the
National Urban Livelihood Mission and also to take help of NGOs working with NRLM and
NULM to achieve the objective of financial literacy. The knowledge regarding basic financial
literacy, operating an ATM card, benefits of timely repayment of loan and overdraft due, etc, will
be imparted in the awareness camps and camps conducted for opening of bank accounts.
Credit Guarantee Fund

It is proposed to create Credit Guarantee Fund under this plan. The CGF will be created and kept
under the National Credit Guarantee Trust. This fund will give a security to banks to provide
over draft credit and will bring in discipline in the monitoring mechanism. It is estimated that
about Rs. 8500 crore corpus will be required. Out of total CGF, half of the amount will be
contributed by banks in terms of guarantee fee and rest of the amount of fund will be given by
the government.

Micro Insurance

Micro life and general insurance policy is given under this scheme to provide insurance coverage
to the poor and economically vulnerable sections of the society. The general insurance can be
provided to an individual or a group which comprises health insurance, personal accident, and
insurance of house, livestock, tools, machinery and instruments. A life insurance policy is a term
insurance contract.

Achievements under PMJDY:

As on 29-3-2017

28.17 crore accounts have been opened under PMJDY out of which 16.87 crore accounts
are in rural areas and 11.30 crore in urban areas.
Aadhaar seeding in PMJDY accounts 18.35 crore.
Overdraft (OD) in PMJDY accounts 4468577 accounts have been sanctioned OD facility
of which 2425075 account-holders have availed this facility involving an amount of Rs.
32002.28 lakhs.

Factors Affecting PMJDY:

Easy E-KYCs with the help of Aadhaar

Insistence on KYC (know your customer) norms has hindered the opening of new
accounts. RBI has made efforts to make the process simpler.

Aadhaar has helped rural populace get an identity so that they can easily meet the KYC
requirements.

Improving Mobile banking service

Mobile banking through phones play an increasingly important role in a scenario where
physical bank branches will be few.
 Technology adaptation

Digital India and advanced technology adaptation by banks.

Improving the system of business correspondent

Banking correspondent is the agent of the banks that serves the rural banking needs
where the penetration of formal banking and branches has been negligible. Can be done by
extending BC jobs to kirana shops, and other local unemployed youth.

Criticism Of PMJDY

Costly and unviable

It will create huge stresses in the banking system.

Many of the new accounts created by inclusion initiatives remain inoperative.

Financial shocks

The scheme exposes the money of the rural poor to external financial shocks.

Many loopholes

Most of the facilities like accident insurance cover, overdraft facility etc. have money
loopholes which the common man doesnt understand.

Steps Taken by RBI to Support Financial Inclusion:

Initiation of no-frills account

No-frills accounts cut cost as well as complexity. These accounts focus only on basic
facilities by cutting down extra frills that are of no use for the lower sections.
 RBI also eased KYC (Know Your customer) norms for opening of such accounts.

Business correspondents

The banks have adopted the business correspondent model to facilitate banking services
in those areas where banks are unable to open branches.

Business Correspondent is the agent of the bank that will take financial services to the
doorsteps of the rural public.

EBT Electronic Benefits Transfer

Human-less transfer of payments and services have reduced costs and the need for
government monitoring.

Financial Literacy
Financial literacy is a very broad term, it not only includes the mere knowledge of various
financial products but it also includes monitoring and efficiently utilizing ones resources for
eonomic well being and welfare of an individual and his family. The problem of lack of financial
literacy is not only with developing countries but also with developed countries. Today
individuals are not able to gulp financial principles easily and thus are not able to manage
financial risks related effectively and suffer from financial downfalls. Financial literacy is better
decision making and is also related with better planning of retirement and gradual wealth
accumulation. financial education should be imbibed from initial stages of ones career to be
called of ones career to be called adequately financially literate.

Need of Financial Literacy

For financial inclusion and inclusive growth:

Financial literacy and financial inclusion are twin pillars where financial inclusion act as supply
side of proving financial services and financial literacy act as demand side making people
acquainted that what they should buy. As the main motto of financial inclusion is to provide
access to financial services to the masses at an affordable cost, so it is imminent that the masses
be financial literate to avail much benefits and augment the process of inclusive growth.
Financial inclusion mainly aims at providing the basic financial services and also the ancillary
financial services like insurance, mutual funds etc which can only be done by making improving
financial literacy.

For improvements in Knowledge and skill:

 As we have seen in this competitive era there exist wide range of various financial products and
services, so it becomes very difficult for investor to choose what suits him best. Sometimes
he/she gets misguided and is not able to make appropriate choices. So here financial literacy
plays crucial role in imparting knowledge to investor so that he can make informed choices. So
financial literacy develops a skill set among individuals which develops confidence to manage
their personal finances and handle unforeseen contingencies more wisely.

Empowers Entrepreneurship:
Financial literacy promotes entrepreneurship and helps to be a small entrepreneur to generate
business, as it gives knowledge and also develops skills in an individual. It helps in effective
understanding of finance and making effective decisions for business. It is dire need of the hour
to improve financial literacy especially in business sector.

Extreme penetration in Financial Markets:

In India, there is a need to channelize savings and covert savers into investors that can only be
done through financial literacy. Basic savings, mortgage and investments options demands
financial literacy. So if financial literacy increases participation in financial markets will also
increase leading to paramount success of economy.

Determinants of financial literacy

Gender:
In India financial literacy is directly affected by its gender as differentiation exist between male
and females since time immemorial. There is a huge financial divide among men and women
across the nations. According to S&P rating services survey 201611, worldwide there is a
considerable gender gap which is evident by the fact that globally 65% of men are not financially
literate while nearly 70% of the women are financially illiterate. The divide is even wider in
India as 73% of men and 80% of women are not financially literate.

Age:
In advanced economies, there is an increase in levels of financial literacy with age but after a
certain age it tends to decline. On an average, 56% of those people who are in the age group of
35 or younger are financially literate, as compared to 63% of those who are in the age bracket of
35-50. At 32%, financial literacy in emerging economies is higher for young adults than for the
oldest adults of whom only about 17% are financially literate. (S&P rating services survey
201611) Thus, it can be concluded that levels of financial literacy are directly impacted by age
factor. Financial literacy among the youths generally ranges from moderate to high levels and it
declines as the age increases. This also shows that an individual has to make efforts to update
and accept the changes which are taking place in financial arena.

Income and Education:

Financial literacy has a Direct relationship with education level of an individual. As the level of
education increases their levels of general knowledge, general awareness, levels of
understanding, levels of perceptions, abilities to comprehend, skills of decision making etc also
improves considerably. Such individuals are more likely to assess financial risks and take
informed decisions to meet their financial goals.

Measurement of Effectiveness of Financial Literacy Program

In order to reach under reached section of society special focus is given on financial literacy
program. Financial literacy centers have been setup to promote awareness towards banking
product. Different platforms like seminars, lectures, choupal meeting and personal meetings are
used by different authorities to improve level of awareness among citizen of country.
Government should take ensure proper implementation of such program by having proper
monitoring systems.

Efforts done for promoting Awareness Of Financial Literacy

Covered 1250 Gram panchayats through 536 Camps by 280 Bank Branches
On the spot RuPay Card distribution
More than 4.5 lakh Housholds have been covered through these camps
Branch wise identification of village clusters having villages from 5-10
At least one drive from each village cluster. Each Camp is linked with one Nodal bank
Branch
Door-to-door approach
With the help of PRI, Department field staff went door to door for providing information
of camps
Filling of PMJDY a/c opening form right there and Kit distribution in the camp.
 Month wise camps by Bank Branches

Camps by Bank Branches

60

50 48
45 45 43 45
40
35
30 30 30 28 28
27 25
20 20 22 20
15 15 15
10

0
41883 41944 42005 42064 42125 42186 42248 42309 42370
41852 41913 41974 42036 42095 42156 42217 42278 42339

Month wise Village drives for PMJDY

 Special Village Drive on PMJDY
18
16
16
14
14 13
12
12
10
8
8
6
4
4 3
2
2
0
41852 41883 41913 41944 41974 42005 42036 42064

Progress-Report
Pradhan Mantri Jan - Dhan Yojana
(Accounts Opened as on 29.03.2017)
(All Figures in Crores)

BALANCE
NO OF AADHAA
Bank RURA URBA TOTA IN
RUPAY R
Name L N L ACCOUNT
CARDS SEEDED
S

Public
Sector 12.34 10.28 22.61 17.60 15.10 49265.50
Bank

Regional
3.98 0.66 4.64 3.54 2.80 11608.91
Rural Bank

Private
0.55 0.37 0.91 0.85 0.44 2098.02
Banks

Total 16.87 11.30 28.17 21.99 18.35 62972.43

Interpretation: From The Above table We can see that Because of PMJDY scheme 28.17 Crore
Account were opened till 29.03.2017. In which 22.61 Crores Were from public sector banks. The
Total Balance in the Accounts were 62972.43 Crore.

District Wise House Hold Report

GUJARAT

DISTRICT ALLOTED WARDs-SSAs HOUSEHOLD

NAME WARDs-SSAs SURVEY_DONE COVERAGE-%

Ahmadabad 359 359 100.00%

Amreli 331 331 100.00%

Anand 385 385 100.00%

Arvalli 261 261 100.00%

Banas Kantha 577 577 100.00%

Bharuch 306 306 100.00%

DISTRICT ALLOTED WARDs-SSAs HOUSEHOLD
NAME WARDs-SSAs SURVEY_DONE COVERAGE-%

Bhavnagar 442 442 100.00%

Boatad 137 137 100.00%

Chhotaudepur 249 249 100.00%

Devbhoomi
172 172 100.00%
Dawarka

Dohad 276 276 100.00%

Gandhinagar 283 283 100.00%

Gir Somnath 192 192 100.00%

Jamnagar 202 202 100.00%

Junagadh 280 280 100.00%

Kachchh 439 439 100.00%

Kheda 492 492 100.00%

Mahesana 432 432 100.00%

Mahisagar 209 209 100.00%

Morbi 186 186 100.00%

Narmada 173 173 100.00%

Navsari 276 276 100.00%

Panch Mahals 292 292 100.00%

Patan 347 347 100.00%

 DISTRICT ALLOTED WARDs-SSAs HOUSEHOLD
NAME WARDs-SSAs SURVEY_DONE COVERAGE-%

Porbandar 118 118 100.00%

Rajkot 374 374 100.00%

Sabar Kantha 375 375 100.00%

Surat 451 451 100.00%

Surendranagar 322 322 100.00%

Tapi 205 205 100.00%

The Dangs 104 104 100.00%

Vadodara 309 309 100.00%

Valsad 275 275 100.00%