New Delhi: Measures to promote financial inclusion, transfer of entitlements to people’s bank accounts using Aadhaar and access to credit to the unorganized sector are making sure that no citizen is left outside of the national mainstream, finance minister Arun Jaitley said on Sunday.
Jaitley’s remarks, in an article released by the finance ministry, marked the completion of three years by the Prime Minister’s Jan Dhan Yojana, a scheme aimed at offering access to basic banking services to the poor.
Jaitley wrote that just as the goods and services tax (GST), rolled out on 1 July, had united Indian states into a common market, Jan Dhan Yojana and a revolution driven by the use of Aadhaar and mobile phones can link all Indians into “one common financial, economic, and digital space."
“No Indian will be outside the mainstream. This is nothing short of a social revolution," wrote Jaitley.
Aadhaar, the 12-digit number issued by the Unique Identification Authority of India (UIDAI), establishes the identity of individuals using biometrics and helps in minimizing diversion of the benefits meant for the needy.
The finance minister said the country was within reach of achieving 1 billion bank accounts being linked with 1 billion Aadhaar numbers and 1 billion mobile phones. So far 524 million Aadhaar numbers have been linked to 736.2 million bank accounts in India.
The second volume of the Economic Survey 2016-17 released earlier this month said the Jan Dhan scheme helped in reducing gender disparity in savings bank accounts. The proportion of women account holders increased from 28% in March 2014 to 40% in March 2017, the Survey said. The total number of savings accounts stood at 1.09 billion at the end of March.
“The government now makes direct transfer of Rs74,000 crore to the financial accounts of 35 crore beneficiaries annually, at more than Rs6,000 crore per month," wrote Jaitley in the article, which was also shared as a Facebook blog.
Entitlements under anti-poverty and welfare schemes including cooking gas subsidy, wages to workers under the employment guarantee scheme, old age pensions and student scholarships are transferred directly to the bank accounts of beneficiaries.
“Direct benefits transfer linked to Aadhaar is the right technological solution in making subsidy targeted. A blanket subsidy is a flawed system since it benefits the undeserving," said Rajat Kathuria, director and chief executive, Indian Council for Research on International Economic Relations (Icrier).
The government saved Rs21,000 crore in subsidies by blocking fake liquefied petroleum gas (LPG) connections, PTI reported in February.
Under the Prime Minister Mudra Yojana, a scheme meant to provide credit to non-corporate businesses, loans of up to Rs10 lakh are directly credited into the bank accounts of beneficiaries. Jaitley said until 18 August, Rs3.66 trillion had been distributed to 87.7 million beneficiaries under the scheme.