The government’s Jan-Dhan Yojana, launched in August 2014, has given a major boost to financial inclusions across the country. Till February-end, 31.2 crore bank accounts had been opened under the scheme, with total deposits amounting to Rs 75,572 crore. Similarly, 13.4 crore people are covered under the government’s personal accident insurance and another 5.3 crore have enrolled for the government’s life insurance scheme. As a result, the all-India CRISIL Inclusix score has risen to 58 in 2016, from 50.1 in 2013. South India tops in financial inclusion, with a score of 79.8, substantially higher than the all-India Inclusix score of 58. The region leads in in all the four dimensions of financial inclusion. The gap in financial inclusion between the South and the rest of the country remains wide.
However, at the national level, there is under-penetration of basic financial services. A large part of the country’s population does not have access to credit services from banks or microfinance institutions. The report points out that only 20 crore borrowers have loans, which is significantly lower than the number of deposit accounts. Branch and credit penetration is currently highly focused in the South and in large cities, and needs to be expanded to other regions as well.
The report underlines that protection-linked insurance products and pension schemes also need to be expanded significantly as the number of people covered under various pension schemes is low.