Central bank unveils 5-yr financial inclusion strategy

The Reserve Bank of India (RBI) last month published a National Strategy for Financial Inclusion (NSFI) 2019-24, aimed at providing access to formal financial services in an affordable manner.

The Financial Inclusion Advisory Committee of the RBI — in consultation with the central government, IRDAI, Securities Exchange Board of India (SEBI), and Pension Fund Regulatory and Development Authority of India (PFRDA) — has recommended various ways in which the objective can be fulfilled.

The approach consists of:

• facilitating universal access to financial services
• providing a bouquet of basic financial services
• providing for access to livelihood and skill development
• promoting financial literacy and education
• ensuring consumer protection and facilitating grievance redressal
• ensuring effective coordination among stakeholders.

The details of the financial inclusion strategy include ensuring that every village have access to a formal financial services provider within a 5-km radius. Customers may be on-boarded through an easy and hassle-free digital process. This includes increasing banking outlets of commercial banks. Digital financial services have to be strengthened in all tier-II to tier-VI centres to facilitate a less-cash society by March 2022.

The plan aims to provide basic financial services — savings account, credit, micro-life and non-life insurance products, pension product, and a suitable investment product — to every eligible adult.

To achieve this, every adult enrolled in the Pradhan Mantri Jan Dhan Yojana (PMJDY), should be enrolled in an insurance scheme and pension scheme. PMJDY is the government's financial inclusion initiative launched in 2014 to allow all Indians to open a basic savings bank account, and have access to need-based credit, remittances facility, insurance and pension.

Source: Asia Insurance Review

http://www.insurancealertss.com//Insurance/NominationForm/17527