JAN DHAN YOJANA ACCOUNT - A Short Description for SBI PO 2015-16

JAN DHAN ACCOUNT 

With the view to help poor and unorganized workers of the country , our central government has decided to introduce three new schemes ; two on insurance products and one on pension scheme.

 

These new schemes might repackage the ongoing present schemes introduced by the previous government and might prove more promising than the previous ones. Insurance pools resources to meet unforseen expenses. 

 

Given that nearly two-thirds of Indians are below 35 years of age, the probability of death in the entire population is small and the premium amount can be kept low to mobilise the resources needed to meet insurance payouts. When coverage is expanded to include the entire population, the odds work in favour of lowering costs. 

JAN DHAN YOJANA ACCOUNT - A Short Description for SBI PO 2015-16

Introducing these schemes does not mean that no state subsidy would ever be needed in future. But the subsidy requirement will not be that enormous as it could otherwise be. The sole aim is that the earlier the worker starts saving for the retirement, the lower will be the burden on the government to ensure him a minimum pension in old age. 

 

These schemes can work well only when the beneficiaries understand the schemes in question and diligently make their contributions towards them. 

The weakness that reflects in the system is not the inconvinience of the poor to cater the small amounts required as their contribution to these funded programmes, but the bank accounts to which these are linked. 

 

While large numbers of bank accounts have been opened, but their operating branches are at distant from the customers’ residing places thus making it difficult for them to operate as ever. 

One of the ways of making banking services available is by the use of phone banking which means accessing banking services through mobile phone-linked accounts that can be operated through ubiquitous banking correspondents for depositing or withdrawing cash. 

 

Moreover, the RBI should give liberalisation to the banking correspondents and allow telecom joint ventures with banking licences to make use of their telecom retail network to service banking needs as well. Once that is done, India will move ever closer to the goal of financial inclusion.