Financial inclusion aims to provide access to affordable financial products and services, particularly for vulnerable groups such as low-income individuals and marginalized sections of society. Initiatives by the Reserve Bank of India, including the Pradhan Mantri Jan Dhan Yojana, have led to the opening of millions of bank accounts and the introduction of no-frills banking services. The dual approaches of minimalist and expanded financial services are designed to enhance economic participation and ensure financial literacy among the disadvantaged.

1. Financial Inclusion
By-
Parth
Shah

2.  Financial Inclusion is the process of ensuring
access to appropriate financial products and
services needed by all sections of the society in
general and vulnerable groups such as weaker
sections and low income groups in particular at
an affordable cost in a fair and transparent
manner by mainstream institutional players

3. ‘Financial inclusion’ or inclusive financing is the
delivery of financial services at affordable costs
to sections of disadvantaged and low-income
segments of society, in contrast to financial
exclusion where those services are not
available or affordable.
An estimated 2.5 billion working-age adults
globally have no access to the formal financial
services .

4. Background
 The Reserve Bank of India (RBI) set up the Khan
Commission in 2004 to look into financial inclusion
 In the report RBI exhorted the banks to achieve
greater financial inclusion with basic "no-frills" banking
account.
 In India, financial inclusion first featured in 2005, when
it was introduced by K.C. Chakraborthy, the chairman
of Indian Bank.
 Mangalam became the first village in India where all
households were provided banking facilities.

5.  In January 2006, the Reserve Bank
permitted commercial banks to make use
of the services of non-governmental
organizations (NGOs/SHGs), micro-
finance institutions, and other civil
society organizations as intermediaries
for providing financial and banking
services.
 Reserve Bank of India’s vision for 2020
is to open nearly 600 million new
customers' accounts and service them
through a variety of channels by
leveraging on IT.

6. Financial Inclusion – Who are these
People?
 Underprivileged section in rural and urban areas
like, Farmers, small vendors, etc.
 Agricultural and Industrial Labourers
 People engaged in un-organised sectors
 Unemployed
 Women
 Children
 Old people

8. Twin Aspects of Financial Inclusion
 Financial Inclusion and Financial Literacy
are twin pillars. While Financial
Inclusion acts from supply side providing
the financial market/services what people
demand, Financial Literacy stimulates the
demand side – making people aware of
what they can demand.

9. Why financial Inclusion?
 Economic Objective
 Mobilisation of Savings
 Larger Market for the financial system
 Social Objectives
 Sustainable Livelihood
 Political Objectives

10. Reserve Bank of India (RBI) adopts
two approaches to achieve Financial
Inclusion
 The minimalist approach–availability of
basic financial products and services.
 The expanded approach–availability of
ancillary financial products such as
general insurance, health insurance,micro-
pension,housing finance and mutual fund.
 Both the Approaches form a broader
context of economic inclusion

11. RBI and GoI Initiatives and
Policy Measures and Involvement
in Financial Inclusion No-Frill Accounts
 Overdraft in Saving Bank Accounts
 Simplification of Savings Bank Account Opening Form-
 Financial Literacy Program
 Simplification of Know Your Customer (KYC) Norms and Guidelines
 Overcoming language barriers
 Kisan Credit Cards (KCCs)
 Opening of branches in unbanked rural locations
 Rural Infrastructure Development
 SHG Bank-Linkage Programme
 Business Correspondents (BCs) and Business Facilitators (BFs) Model-
 Creation of Funds for Financial Inclusion-Financial Inclusion Fund and
Financial Inclusion Technology Development Fund

12. Pradhan Mantri Jan Dhan
Yojana
launched by the PM of India, Narendra Modi on 28 August
2014
Run by Department of Financial Services, Ministry of Finance,
on the inauguration day, 1.5 Crore (15 million) bank accounts
were opened.
By 28 January 2015, 12.58 crore accounts were opened, with
around 10590 crore (US$1.7 billion) were deposited under the
scheme.

13. Benefits under PM JDY
Scheme
 Interest on deposit.
 Accidental insurance cover of Rs.1.00 lac (to be given
by HDFC Ergo)
 No minimum balance required.
 Life insurance cover of Rs.30,000/- (to be given by LIC)
 Easy Transfer of money across India
 After satisfactory operation of the account for 6 months,
an overdraft facility will be permitted
 Accidental Insurance Cover, RuPay Debit Card must be
used at least once in 45 days.
 Overdraft facility upto Rs.5000/- is available in only one
account per household, preferably lady of the
household.

15. THANK YOU