Financial Inclusion Current Affairs - 2020

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RBI launches 5-year Financial Inclusion Strategy

The Reserve Bank of India has launched National Strategy for Financial Inclusion (2019-24). The main motive of the strategy is to provide access to financial services in an affordable manner.

Highlights

The Strategy has been launched after thorough consultation with SEBI (Securities Exchange Board of India), PFRDA (Pension fund Regulatory and Development Authority of India) and also Insurance Regulatory and Development Authority of India (IRDAI). The strategy was launched based on the recommendations of the Financial Inclusion Advisory Committee that worked in consultation with the above agencies.

Key Recommendations

The following are the recommendations included in the strategy

  • The committee has recommended Universal Financial Access. Under this, every village will have formal financial service provider within a radius of 5 km.
  • The committee has recommended for the strengthening of Digital Financial Services to reach a less-cash society by 2022.
  • Every adult registered under Pradhan Mantri Jan Dhan Yojana should be enrolled in pension scheme and insurance scheme
  • The Public Credit Registry shall be made completely operational by March 2022.

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MGNREGA scheme faces funds shortage

The MGNREGA (Mahatma Gandhi Rural Employment Guarantee Employment Act) scheme released its financial statement recently. According to the statement, almost 96% of the money has already been spent. Only 2,500 crores of rupees is left to sustain the scheme for the next two months.

Highlights

According to the financial statement of the scheme, 15 states are in red meaning, there is fund depletion or fund unavailability. Among all the states, Rajasthan has the highest negative net balance of Rs 620 crores. Following Rajasthan, Uttar Pradesh had a negative net balance of Rs 323 crores. The budget allocated to the scheme was Rs 60,000 crores and is less as compared to the previous years.

Current Scenario

The pending dues in the state of Rajasthan is alone Rs 1,950 crores. Under the scheme, 75% of the wages should be paid within 15 days of time period. However, there is delay in the payment currently due to lack of funds. This will create lack of confidence among the citizens over the scheme.

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