Mamata proposes govt-sponsored deposit-taking scheme

The scheme can be named as 'Social Security Scheme' or 'We The People Scheme'; would not offer high returns like chit funds

West Bengal Chief Minister Mamata Banerjee today proposed to launch a government-sponsored deposit-taking scheme to provide a secured saving option to the rural people of the state as an alternative.

“To provide proper facility in the wake of growing financial insecurity, we are thinking of a social security scheme. It will ensure proper safety for public money and ensure decent return, proper return. We will put out a proposal on the finance department's website, inviting public opinion,” Mamata Banerjee said.

Blaming the lack of adequate number of saving options for poor rural people as the reason behind  mushromming chit funds in the state, she said the government financial scheme is aimed to meet that need.

While investigation is on into the Saradha scam, with its promoter Sudipta Sen in police custody, the state police has in the meantime, raided offices of two more such companies, pulling the plug on their operations.

The proposed financial scheme is likely to be backed by a state legislation. “We invite opinions from all section of people,” she said.

GoM set up to tackle Ponzi schemes
The central government today set up an inter-ministerial group for proper enforcement of regulatory framework of companies running collective investment schemes, reports our Delhi bureau. The group, under the chairmanship of the additional secretary, Department of Financial Services, will also look at level marketing companies, non-banking financing companies and hold its first meeting on May 16, a statement said.

However, she pointed out that the government-sponsored scheme -- which according to her, can be named as “Social Security Scheme” or  “We The People Scheme” -- would not offer high returns like chit funds.

“There may not be high return, but with the government's involvement, there will be security, which is more important for people, who are being cheated by chit funds,” she said.

Banerjee did not share further details of the plan as the scheme is at the planning stage.

Although the government did not set any deadline for the launch of the scheme, the chief minister said, the government would soon put the propsal on its website, that would accept public suggestions for a period of one month.

“We will decide and chalk out the scheme after receiving public comments,” she noted.

The state government's proposal is seen as an yet another effort to show that it is serious about taking decisive action against deposit-taking companies. The Trinamool Congress government has been under immense political pressure because of the alleged link between its leaders and some illegal money-pooling companies.

As investigation is on into Saradha scam with its promoter Sudipta Sen being in the police custody, the state police has in the meantime has recently raided offices of two more such companies, pulling the plug on their operations.