Modi set to launch financial inclusion scheme Thursday

Prime Minister Narendra Modi is set to launch his pan-India financial inclusion scheme here Thursday, with 76 similar events and some 60,000 camps of state-run banks to open spot accounts in both rural and urban areas across the country.

The central ministers and state chief ministers have been asked to participate in the events for the launch of what is being formally called the Pradhan Mantri Jan Dhan Yojana -- a name selected from entries sent by people participating in a contest.

"It is estimated that about one crore (10 million) accounts will be opened this day. The camps will be successful as preparatory camps have already been organized to get the required information from new account openers," the finance ministry said in a statement.

"As a first step, every account holder gets a RuPay debit card with a Rs.1,00,000 accident cover," said the statement, adding that an overdraft of up to Rs.5,000 will also be permitted after six months.

The prime minister had sent about 725,000 emails to bank officers referring to his Independence Day announcement of the scheme -- which is a national mission on financial inclusion.

Its objective is to cover all the estimated 75 million households in the country with banking facilities with a bank account for each.

"This will enable them to come out of the grip of moneylenders, manage to keep away from financial crises caused by emergency needs and, most importantly, benefit from a range of financial products," the finance ministry said.

Highlights of the scheme:

- The mission will be implemented in two phases

- Phase-I will conclude Aug 14, next year

- It will extend universal access to all households

- Such access will be direct or through correspondents, like neighbour mom-and-pop stores

- Accounts will have in-built RuPay Debit card

- The account will also extend accident insurance of Rs.1,00,000

- An overdraft facility up to Rs.5,000 will also be allowed

- Phase II will start from Aug 15, next year

- It will provide micro-insurance to people

- Unorganised sector pension schemes will be extended

- It will target households than villages in the earlier schemes

- Both rural and urban areas will be covered

- Emphasis on monitoring by a mission under the finance minister.