As of October 2021, about 44 crore beneficiary accounts under the Pradhan Mantri Jan Dhan Yojana (
PMJDY) have been integrated with ‘JAM’ (
Jan Dhan-Aadhaar-Mobile) trinity thereby helping the government improve the targeting of its programmes by addressing the right section of people, a top official in the Union Finance Ministry said.
“Earlier when I was handling the National Food Security Act, the problem was that a lot of benefits were going from the government, but we were not sure whether they were reaching the right people or not,” said Manisha Sensarma, Economic Adviser, Department of Economic Affairs (DEA), Ministry of Finance.
“Knowing that resources are limited and need to be used in a judicious manner, what we have now tried to attempt through use of technology and leveraging Aadhaar is that intended benefits should reach the eligible and identified beneficiaries so that there is no leakage of resources,” she said.
Sensarma added that in absence of this infrastructure, while facing the challenges of the pandemic it would have been very difficult for the Government to deliver the way the delivery mechanisms were put in place had the PMJDY accounts not been in place.
“During the Covid, there were many benefits that were provided directly into beneficiaries’ accounts via the DBT system,” said Sensarma.
Noting that women are a major component in PMJDY accounts, she said, “In the package that was announced after March 2021, an amount of Rs 500 per month for initial three months for women could be transferred in a very seamless manner because of the existence of PMJDY accounts.”
She added that these benefits which were announced during the Covid pandemic could seamlessly reach the beneficiaries because of the infrastructure that had been created for the downtrodden and those at the bottom pyramid of the population. “For instance, some of the benefits which were transferred during pandemic, it included cash transfers to the vulnerable sections, insurance coverage for health workers, employment provisions and measures for migrant workers, besides, wage component was also increased under Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA).”
Sensarma further said that in order to bridge the gaps by focusing on MSMEs and NBFCs there were relief-based measures as various announcements were made during the pandemic and regulatory compliance measures were announced during this period, so as to streamline the processes.
She said that in an all-India debt and investment survey conducted by NSSO in 2019 whereby about 2,000 rural villages and 4,000 urban blocks were covered, it was found that about 95 per cent of households had at least one financial asset viz., be it a savings account, retirement account, risk free product, insurance account, some savings scheme. “So even the vulnerable sections are getting covered under financial inclusion, that in itself is a pointer that we intend to cover the bottom pyramid of population.”
Talking about the Mudra Scheme – categorised in three parts viz., Shishu, Kishor and Tarun, launched to provide credit to MSMEs as term loans or meeting their working capital requirements, particularly in manufacturing, trading and services sectors she said, “We are happy to record that out of total disbursements, roughly about 87 per cent of the loan disbursements are under Shishu category providing loans up to Rs 50,000. So small entrepreneurs are being addressed and catered to by this scheme. Simultaneously it addresses women entrepreneurs as they account for two-third of beneficiaries covered under Mudra Loans.”
She also said that digital payments have become very resilient and the kind of response being received is very-very encouraging. “As of September 2021, 259 banks had joined the digital space, so technology is helping simplify procedures and make our lives easier including for small vendors.”
She also sought cooperation of all stakeholders including private sector, industrial associations, civil society to further promote financial inclusion, a major enabler to take the country forward.
In his address, Sudatta Mandal, deputy MD, Small Industries Development Bank of India (SIDBI) said that open-based lending is one of the initiatives which SIDBI is going to take.
“We are in the process of working out a pilot scheme for providing unsecured, invoice-based financing through the open network,” said Mandal.
He also said that cash-flow based lending is going to be the trend going forward. “We have to move forward from traditional balance sheet based lending to cash-flow based lending, for that access to alternate data is very important.”