Financial Inclusion and MGNREGA payment initiative in Jharkhand Ajoy Kr. Singh , Secretary Sports & MGNREGA Commissioner
Panchayat Bank: CSC Model
100 days of guaranteed employment to registered HH.
Job within 15 days of filing application.
Unemployment allowance if job not provided within time.
Payment within 15 days of job.
Payment through Bank/Post office.
Population 3 crores (approx.)
villages 36,000, Panchayats 4423
Bank branches only 1500
One branch for 20,000 people, mostly rural (on Avg.)
MGNREGA accounts : 30 lakh beneficiaries; 75% accounts with Post offices.
Complex and time taking Wage payment
12 Blocks Selected for total FI in Pilot mode for UIDAI Project
One block one bank approach adopted for total FI. .
Scheme extended to entire state
EOI was floated in consultation with RBI.
Excellent response from banks.
All 259 blocks already allocated to 9 different banks.
Alignment of FI and Enrolment process
2% transaction fee to be given only in pilot Blocks.
2. Financial Inclusion
Conditions imposed on Banks :
For 100% FI for cash transfer under MGNREGA as well as other social sector programs such as old age pension, etc.
Banks to open Aadhaar enabled or otherwise Bank Accounts.
Condition to establish Panchayat banks either through CSC or any other BC
All account of Blocks/Panchayats and beneficiaries in a Block will be with one Bank.
No financial instruments
No transaction time
No fund/cash transfer from one bank to other Bank/PO
Number of Enrolments: 23,34,715
Number of Aadhaars: 8.12 Lakhs
Number of Accounts opened: 8,05,000
Plan to include approximately 1 crore of bank accounts by the end of this Financial Year
Financial Inclusion : Progress
Banks directly or
Based only on Aadhaar
FI through CSC
Sl. No. Bank No. of Block Number of Accounts 1. ICICI Bank 27 147000 2. State Bank of India 105 6200 3. Central Bank of India 5 5100 4. Union Bank of India 19 57000 5. Bank of India 72 166000 6. Allahabad Bank 17 405000 7. AXIS Bank 3 4000 8. Jharkhand Gramin Bank 7 14700 9 United Bank 4 NIL Total 8 259 8,05,000
Flow Diagram for Opening of Aadhaar enabled bank Accounts for MGNREGA and BPL beneficiaries
Financial Inclusion through CSC
Agreement executed between SBI and SCAs (UTL and AID) for 18 out of 24 districts.
Execution of agreements between other banks and SCA in progress
FI in online mode from Panchayat Bank
Total Accounts opened is 4962
Total Accounts Pending – 588
Total Accounts Active – 4374
3. Panchayat Bank : CSC Model
Need to have increase in the number of banking outlet close to beneficiary.
Banking outlet at the Panchayat level (Panchayat Bank) either through CSC or any other agency as BC of the Bank.
Approx. 4500 Panchayat Banks in entire State.
Pilot Panchayat Banks working in approx 50 Panchayats
UTL using SBI Kiosk Software of bank
Total Amount distributed to MGNREGA beneficiaries – Rs. 15,01,452
Biometric Authentication based payment
Authentication of VLEs
Login by VLE
Biometric authentication of
Login of Beneficiary’s Account
Biometric authentication of
Closure of account
Print out of receipt
Biometric Authentication based Payment Model Only stage of physical cash movement BANK SERVER CIDR SERVER (UIDAI) Auth. Request With Biometrics Response
Transition to Aadhaar enabled payments
- Change in agreement of BC and Bank
Change in Software of Panchayat Bank
Transfer of cash on the basis of Aadhaar
Authentication from UID server
Shifting of CSC in Panchayat building ensures visibility
Better coordination with government offices
Advantage of Space and Power to CSC
Banking services in each panchayat
All services under one roof
Other financial services/MGNREGA entry of data in MIS portal
Supplementary income to CSC
A viable business model.
Connectivity at Panchayat level : VSAT
Availability of Power : Solar Power
Lack of expertise
Lack of availability of Software
Training of VLEs
Execution of agreement between Banks and SCA
To confirm to Aadhaar enabled banking transactions (interoperability)