'Financial inclusion helps in development'

Corporation Bank CEO and MD Jayakumar Garg said multipurpose financial inclusion schemes would bring in constructive changes in terms of development.

Speaking after inaugurating a workshop on ‘Fostering Innovation in Financial Inclusion’ organised by School of Management, Manipal University, he said financial inclusion, introduced in the form of Jan Dhan Yojana, has led to opening of 27 crore accounts. “This is a milestone achieved as anyone can now go and open an account and relax as most of the transactions are done through the account,” he added.

Garg said due to the financial inclusion schemes, government has earned Rs 18,000 per year in the last two years. If all programmes are introduced effectively, the amount procured will be unimaginable, he said.

He said that Rs 65,000 crore has come in from the accounts that have been opened in the banks. On an average, the amount deposited in each account is around Rs 3,200, he noted.

Garg also lauded Aadhar seeding which enables more authentic services through biometric usage. Comparing the demonetisation period to a litmus test, he said bankers proved that they can do anything. Small accounts are important as the lower class will shortly become middle class and middle class will become upper middle class, he felt.

He said 21st century belongs to India as there is ample potential for the country to grow. The country’s GDP is nearly 7%, which is not the case of USA and China.

China is trying to achieve 7% GDP. India has a large population of youths and the largest English speakers are in India. The IT industries in India are booming and there is no current account deficit and inflation is under control, he said.

Former Syndicate Bank general manager Allen C A Pereira said Pigmy is the most outstanding form of financial inclusion which is robust in nature. “It is the most passionately implemented programme. The Pigmy collector is more honest when compared to business correspondents. Pigmy is the most trusted and secured form of financial inclusion. Banks are sensitive and are not driven by profit motive,” he said.

Garg said public sector banks are more economically structured. There is a tremendous challenge ahead following the re-launch of financial inclusion in August 2014. Pradhan Mantri Jan Dhan Yojana has not even reached 50% of the total 60,500 villages. There is no banking facility in these villages, he said and added that banks should be aware of technological frauds.

According to a report of India Banking Association in 2015, 1,69,190 cyber crime cases are reported accounting to a loss of Rs 29,910 crore. “There should be financial and technological literacy. Failure to access human control over technology would be disastrous. The economic growth is jobless economy as the growth has created mere 13,500 jobs as opposed to the demand for Rs 12 million in 2015,” he said and called for a change in the mindset of the banking sector.