With an aim to increase financial inclusion, the government has asked Public Sector Banks (PSBs) to expand pension, insurance coverage and also use financial technology (fintech) to extend credit to borrowers through co-lending arrangements during the festive season, Business Standard reported on Thursday. A broad outline has been given to banks by the government, ranging from financial inclusion to signing co-lending agreements with Non-Banking Finance Companies (NBFCs) and Micro Finance Institutions (MFIs).

Adding to that, banks have been asked to identify individuals who are 21 years of age, through the voters list and do not have a bank account. Then, lenders will have to open accounts under the Pradhan Mantri Jan Dhan Yojana (PMJDY).

Under the PMJDY, state owned lenders have been given a target to provide RuPay cards to 100% in metro and urban areas, and 90% account holders in semi-urban and rural areas, in order to give a digital push. As of October 10, about 315 million RuPay cards had been issued to PMJDY account holders.

Account holders above 50 to be included in the PMSBY scheme

Further, banks have been asked to cover every household under the PM Jeevan Jyoti Bima Yojana (PMJJBY) for operative PMJDY accounts. They have been also asked to identify PMJDY beneficiaries up to 40 years of age and cover them under the PMJJBY, the PM Suraksha Bima Yojana (PMSBY) and the Atal Pension Yojana (APY). Account holders above the age of 50 years will be covered under the PMSBY.

The Reserve Bank of India’s (RBI) financial inclusion index, which captures the extent of financial inclusion in the country, was 53.9 ended March 2021, as compared to 43.4 for the period ended March 2017.