Roadmap for Answer Writing Introduction Definition of Inclusive Growth Explain what inclusive growth means, highlighting its focus on equitable distribution of economic benefits. Fact: According to OECD, inclusive growth creates opportunities for all and reduces poverty. Body Salient Features of Inclusive Growth Skill Development Importance of enhancing employability ...
Model Answer Introduction Financial inclusion aims to provide vulnerable groups, such as low-income households, with access to financial services and credit at affordable rates. The Government of India defines this process as ensuring that these groups can avail themselves of necessary financial serRead more
Model Answer
Introduction
Financial inclusion aims to provide vulnerable groups, such as low-income households, with access to financial services and credit at affordable rates. The Government of India defines this process as ensuring that these groups can avail themselves of necessary financial services. The Pradhan Mantri Jan-Dhan Yojana (PMJDY) is a significant initiative in this context, having successfully banked over 46.25 crore beneficiaries since its inception.
PMJDY’s Role in Financial Inclusion
PMJDY is crucial for bringing the unbanked into the institutional finance fold through several mechanisms:
- Universal Banking Access: The scheme aims for every household to have at least one basic banking account, promoting financial literacy and access to credit and insurance. This is facilitated through zero-balance accounts, ensuring that even the poorest can engage with financial institutions.
- Facilitating Banking Services: The Direct Benefit Transfer (DBT) system allows government subsidies for kerosene, LPG, and fertilizers to be transferred directly to Jan-Dhan accounts, familiarizing beneficiaries with banking services.
- Enhanced Credit Penetration: The zero-balance account enables previously unbanked individuals to access credit. The Kisan Credit Card scheme further supports farmers with affordable loans, enhancing their financial security.
- Formalizing the Financial System: PMJDY provides a pathway for the poor to integrate their savings into the formal financial system, reducing reliance on usurious moneylenders.
Challenges and the Path Forward
While PMJDY has made significant strides, challenges remain. A World Bank study highlights that over 43% of bank accounts in India are dormant, indicating low engagement. To prevent accounts from becoming inactive, it is essential to promote financial literacy, ensure effective DBT, and encourage a cashless payment system.
Conclusion
PMJDY is a landmark step towards financial inclusion for the poorer sections of society. However, continued efforts are required to keep these accounts active and ensure that the benefits of financial inclusion are fully realized. A collaborative approach involving the government and civil society will be key to achieving these objectives.
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Model Answer Salient Features of Inclusive Growth Inclusive growth is characterized by several key features that ensure economic benefits are shared across all segments of society: Skill Development: Enhancing the employability of the working-age population through education, vocational training, anRead more
Model Answer
Salient Features of Inclusive Growth
Inclusive growth is characterized by several key features that ensure economic benefits are shared across all segments of society:
Has India Been Experiencing Inclusive Growth?
Despite these features, India faces significant challenges in achieving inclusive growth:
Inclusive growth is characterized by several key features that ensure economic benefits are shared across all segments of society:
Has India Been Experiencing Inclusive Growth?
Despite these features, India faces significant challenges in achieving inclusive growth:
Measures for Inclusive Growth
To address these challenges, India has initiated several measures:
Additionally, fostering partnerships with international organizations, civil society, and private firms can enhance efforts towards inclusive and equitable growth.
Conclusion
Inclusive growth is essential for empowering marginalized communities and improving living standards in India. Continued focus on poverty eradication and sustainable development by all levels of government is crucial for enhancing the lives of the Indian populace.
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