Digitisation key to financial inclusion- Hon’ble FM Nirmala Sitharaman

Hon’ble FM Nirmala Sitharaman emphasised on digitisation to accelerate financial inclusion in the country, underlining that digitisation must be embraced by Banks.

September 12, 2021

PM Modi’s Jan Dhan Yojana (2014) an important initiative towards financial inclusion.

During the pandemic, GOI distributed US$ 20.37 in three instalments to the economically underprivileged.

Centre also introduced the Emergency Credit Line Guarantee Scheme during the pandemic to aid MSMEs.

Financial inclusion brings the unbanked population within a formal banking ecosystem.

To ensure that benefits from the government schemes reach the weaker sections of society, Finance Minister Nirmala Sitharaman pushed for greater digitisation of banks, including those in the private sector, as the means to accelerate financial inclusion for a wider reach. While delivering her address at the centenary celebrations of the city-based Tamilnad Mercantile Bank, the FM underlined that during the Covid-19 outbreak US$ 20.37 was provided  in three instalments to the needy directly in their bank accounts, made possible by the financial inclusion initiatives announced by the GOI. .

Financial inclusion allows access to banking services for all  regardless of their income, while  providing financial solutions to the economically underprivileged. FM maintained that for enhanced financial inclusion, digitisation should be suited to the customer’s needs at an  affordable cost , which is also  sustainable for providers. Digitisation of banks has ensured that any financial activity remains independent of its location. 

The efficiency of banks can be further augmented by adopting complete technological solutions. The ‘Jan Dhan Yojana’, announced by GOI in 2014, allowed  financial inclusion in its truest sense, bringing  large proportions of the unbanked population within  the formal banking ecosystem. Hon’ble PM Modi launched the Jan Dhan Yojana in 2014 for the economically weaker sections and gradually built on it’s successes with the Mudra and SVANidhi loan.

Today financial technology (or fintech) plays a pivotal role in the national economy and for banks the way forward is to be more efficient by adopting the digitised way. Fintech  can be used to populate data into forms, for further use for taxation purposes.. FM  also underlined that the Centre had introduced the Emergency Credit Line Guarantee Scheme during the pandemic to enable MSMEs to carry on  their businesses without giving any additional collateral.