Now, 3.5 cr savings accounts for NREGA, 1.7 cr with post offices

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New Delhi, Oct 9: In one of the biggest initiatives for financial inclusion in recent times, more than 3.5 crore savings accounts have been opened with post offices and banks across the rural belt in the country for ensuring the payment of wages under the National Rural Employment Guarantee Act (NREGA).

The ministry of rural development had urged the state governments to stop cash payment of wage to the workers under NREGA at the earliest for stopping irregularities and preventing delay in payment of wages. The rural development ministry has requested the finance and communication ministries to expedite the opening of savings accounts with banks and post offices respectively.

According to data accessed from the rural development ministry by FE, till August, more than 1.8 crore savings accounts had been opened with banks, while 1.7 crore savings accounts have been opened with post offices. “We have urged states to stop cash payment of wage, there is possibility of another three crore accounts to be opened up over the next few months,” Rita Sharma, secretary, ministry of rural development told FE .

During 2007-8,Rs 10,738.47 crore was paid as wages, under NREGA, to more than 3.3 crore households out of the total expenditure of Rs 15,856.89 crore, when the UPA’s flaship anti poverty programme was in operation in 330 districts.

Sharma said out of the total wage payment of Rs 9000 crore during the current year, Rs 3000 crore has been paid through savings accounts. However, despite a special drive by the various states governments, only about 37% of wage under NREGA was paid through savings accounts till August. While states like Karnataka, Kerala & Andhra Pradesh have stopped cash wage payment, states like Uttar Pradesh, and Madhya Pradesh are lagging behind in opening accounts.

The data complied by the rural development ministry indicates that out 1.7 crore new savings accounts opened with post offices, more than 1 crore accounts have been opened in Andhra Pradesh for payment of wage under NREGA. Rajasthan has opened more than 27 lakh accounts while 14 lakh accounts have been opened in Jharkhand.