Modi launches financial inclusion scheme, 15 million accounts opened

Prime Minister Narendra Modi Thursday launched the pan-India financial inclusion scheme called "Jan Dhan Yojana", a flagship project of his government, under which bank accounts and RuPay debit cards with an insurance cover of Rs.100,000 will be provided to millions still without access to formal banking facilities.

In the manner the scheme was launched, records have been broken for the banking and insurance sectors, the prime minister said in his inaugural address.

"One-and-a-half crore (15 million) insurance policies on a single day, and 1.5 crore bank accounts opened in a day would never have happened before. This is a big record in banking and insurance history," Modi said. The figure is close to the population of the Netherlands.

Over 77,000 camps were set up for simultaneously opening accounts, the prime minister said.

"On 15th August, we declared the scheme, it has been implemented in 15 days and 1.5 crore people have been enrolled in a single day," he added.

The objective is to provide each of the estimated 75 million households in the country with a bank account and insurance policy.

A film on 'Financial Inclusion' was screened, the prime minister unveiled a logo and a Mission Document on financial inclusion. He also dedicated a mobile banking facility on basic mobile phones to the nation.

In fact, the overwhelming first-day success led Finance Minister Arun Jaitley, present on the occasion, to revise the earlier time-table for the Pradhan Mantri Jan Dhan Yojana.

Phase-I, wherein 75 million account holders were to be enrolled by Aug 14, 2015, has been brought forward to Jan 26, 2015, Jaitley announced.

The second phase, wherein an overdraft of Rs.5,000 will be provided to each account holder will now commence from Republic Day, Jan 26, 2015.

"This whole exercise is aimed at lifting the poor out of the poverty line. After today's breakthrough momentum, I don't think it (Jan Dhan Yojana) will stop," Modi said.

Indian industry welcomed the launch of the financial inclusion scheme to empower India's poor.

"It is an innovative and much needed step in the right direction which will address the biggest national challenge, that is, eradication of poverty, through financial inclusion," said CII director general Chandrajit Banerjee in a statement.

"This will also allow the government to transfer the subsidy benefits directly to the end consumer which will help in plugging the leakages occurring in the current system," he added.