UPSC SOCIOLOGY MAINS SYLLABUS
Paper 2 – C. Social Changes in India:
(i) Visions of Social Change in India:
a) Idea of development planning and mixed economy.
b) Constitution, law and social change.
c) Education and social change.
(iii) Industrialization and Urbanisation in India:
a) Evolution of modern industry in India.
b) Growth of urban settlements in India.
c) Working class: structure, growth, class mobilization.
d) Informal sector, child labour.
e) Slums and deprivation in urban areas.
The core of financial inclusion is to ensure that formal financial services are available to the public. These include functioning bank accounts for savings and transactional purposes, low-cost credit for personal and productive purposes, financial advisory services, and insurance facilities.“Jan Dhan-Aadhaar-Mobile (JAM) Trinity” has been the key backbone on which new digital business/delivery models have been developed in financial services space increasing financial inclusion example implementation of Direct Benefit Transfers (DBT).
RATIONALE OF JAM
Jam Trinity, an abbreviation for Jan Dhan Yojna, Aadhaar and Mobile is concerned with direct subsidy transfers. The Aadhaar would help in direct biometric identification of disadvantaged citizens. Jan Dhan Bank accounts and mobile phones will help direct transfer of funds into their accounts.
One of the important thrusts under JAM was to improve bank account ownership by bringing banking to the bottom of the pyramid. By government estimates, approximately 470 million individuals hold Jan Dhan bank accounts, opened since 2014, of which 261 million are women account holders .Further, as a key enabler of the DBT system, the JAM trinity has aided improvements in the delivery of government benefits to citizens. The DBT system eliminated physical cash distribution channels, instead facilitating electronic transfers directly into bank accounts. The Aadhaar-seeding of bank accounts allowed for the identity verification of beneficiaries, helping ascertain whether welfare benefits were being sent to the correct individuals.
EXAMPLE OF JAM TRINITY MODEL
An individual would submit their Aadhaar details to enroll into the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) or to receive old age pension as per the Indira Gandhi National Old Age Pension Scheme (IGNOAPS). Their identity would be verified against their Aadhaar, and the relevant benefits transferred to the bank account which is linked to the provided Aadhaar number.
RELEVANCE OF JAM
During the COVID-19 pandemic as well, the direct benefits were transferred swiftly and seamlessly and proved to be empowering for financially vulnerable people of the country. The rate of failure of DBT transfers has dropped to a mere 0.04% in June 2020. Thus, the scheme has created a digital trail for the accessibility of other financial services as well. Other benefits of the PMJDY include, but are not limited to, the cost of acquisition has gone down, the time required for the account to be active has gone down from one week to now being opened instantly and being active in 24 hours.
ENABLERS OF FINANCIAL INCLUSION
- Technology acting as a catalyst.
- Initiatives of the government.
- Active role played by financial institutions and FinTech players.
Microfinance has primarily provided small loans and financial services to low-income groups. They have been an extremely crucial economic tool to increase penetration among the groups untouched by the banking sector. Microfinance institutions have also played an important role in spreading financial awareness and financial literacy which eventually leads to financial inclusion.
India has made a substantial progress in financial inclusion, but efforts are needed not only from banking and other financial institutions, but also from the stakeholders including civil society. Fintech and Digital Financial Services have a major role to play in the future with increasing technology usage and infrastructure. There is a need to leverage this vibrant ecosystem to take the financial inclusion from just a banking service to providing gamut of financial services to every citizen.