Why ULIP mis-selling has become rampant ?

Free foodgrains, direct cash assistance, increased allocation for Mahatma Gandhi National Rural Employment Guarantee Act employment guarantee programme scheme are the three elements that the poor have received so far as relief from Covid-related distress.

As a part of a package specifically designed for relief of the bottom-of-the pyramid population, the Centre paid Rs 500 to about 20 crore accounts of women in underprivileged families in April, May and June 2020.

Cash to women

The money was paid to the women folk so that men do not get hold of the cash and burn it on some non-essential items.

Though the cash assistance was for three months, poor families have been receiving free foodgrains for a longer period and the flow is still continuing.

Until Diwali

The poor will continue to receive free foodgrain till Diwali, Prime Minister Narendra Modi announced on June 7.

Residents of bottom-of-the-pyramid, numbering about 79.39 crore, have started receiving free foodgrain from May and it was supposed to end in June 30. But reviewing the situation, the government decided to extend the programme till Diwali.

Addressing nutrition gap

Each person gets 5 kg of foodgrain per month under this scheme. The beneficiaries are covered under the National

Food Security Act (NFSA). This distribution is over and above the quota stipulated by NFSA.

The scheme of free foodgrains was conducted from April to November last year too.

With millions losing employment and suffering reduction in wages, this scheme was a direct nutritional support to a large number of people.

Rural employment

Last year, a large number of migrant workers went back to their villages, the Centre raised funding for the MNREGA employment generation programme to beef up rural employment opportunities.

The allocation to this flagship scheme was raised by Rs 40,000 crore to Rs 1.11 lakh crore in FY21 to tackle the increased demand after millions of jobs were lost and the employment market ran dry following the nationwide lockdown. The initial allocation for this programme last year was Rs 61,500 crore.

Record wages

Of the revised allocation of Rs 1.11 lakh crore, as much as Rs 78,000 was paid out as wages, a record.

Last year, a record number of individuals – 11 crore – got work under this programme. About 390 crore man days of work was also generated during the year, which was another record. The programme was launched in 2006.

As much as 52 days of work was provided on an average under MGNREGA which was higher than the 42 days recorded in the past few years.

The daily wage was revised last year from Rs 182 to Rs 202.

Banks prodded

Indian Banks Association has also prodded banks to quickly pay balance amount stuck in the accounts of Covid victims and settle insurance claims by the families, many of whom are poor people. In order to expedite the payments, IBA quoted a government instruction and said death certificates issued by panchayats and anganwadi workers can also be accepted to expedite processing of claims of settlement of Covid-19 victims if the concerned municipal bodies delay in issuing them.

“Indian Banks Association advises banks to pay balance & settle claims of surviving family members of Covid-19 deceased quickly to mitigate delays and hardship,” IBA tweeted.

PMJJBY, PMSBY

These insurance schemes are Pradhan Mantri Jeevan Jyoti Bima Yojana and Pradhan Mantri Suraksha Bima Yojana respectively.

Anyone between 18 and 50 years is eligible to buy PMJJBY insurance cover of Rs 2 lakh for an annual premium of Rs 330. PMSBY cover can be purchased by anyone between 18 and 70 years with a bank account. It offer Rs 2 lakh cover for accidental death and full disability and Rs 1 lakh for partial disability. The premium is Rs 12 annually.

It is clear both are targeted at the underprivileged families.

Apart from the very base of the pyramid, the government announced a number of steps for the salaried middle class, professionals and small businessmen.

For example, banks are offering personal loans up to Rs 5 lakh for Covid-related treatment. This has followed a creation of on-tap liquidity of Rs 50,000 crore by RBI as announced in early May 2020.

The interest rate is 8.5% for State Bank of India though other banks would be deciding their own rates on this loan.

Those who are members of Employees Provident Fund can quickly withdraw from the fund.

On June 1, the Employees Provident Fund Organisation issued a circular and said that members can take instant loan of Rs 1 lakh for medical emergency. No guarantee or collateral would be required for such withdrawal.