Skip to main content

Modi's Jan Dhan scheme "lacks" any explicit purpose; India's accounts penetration worst among BRICS nations: World Bank

By Rajiv Shah
A new report by the World Bank, “Global Findex Database 2014: Measuring Financial Inclusion Around the World”, has said that the Government of India’s high-profile Jan Dhan scheme, launched for bank transfer subsidies to the poorer sections of India’s population, has been lacking any “explicit purpose”, one reason why around 43 per cent of the country’s accounts are "dormant."
The report, whose Indian survey is based on what it calls “face-to-face” interview with around 3,000 lower middle class sections of the population between September 7 and October 15, 2015, said, “In South Asia about 40 percent have an account classified as dormant. One possible reason for this is the large number of accounts opened within the past year in India, many of which were set up without an explicit purpose in mind.”
The report, which has been authored by Asli Demirguc-Kunt, Leora Klapper, Dorothe Singer and Peter Van Oudheusden, has found that the account penetration in India of all adults is 53 per cent, of women 43 per cent, and of adults in poorest 40 per cent households is 44 per cent.
While this may be some consolation as it is much better than the neighbouring Pakistan (13 per cent, 5 per cent, and 11 per cent respectively), it is worse than not only all other BRICS countries but also the average of the developing countries.
Thus, in China the account penetration among adults is 79 per cent, women 76 per cent, and among adults in poorest 40 per cent households 72 per cent. The respective figures for Brazil are 68 per cent, 65 per cent and 58 per cent; for Russia 67 per cent, 70 per cent, and 62 per cent; and South Africa 70 per cent, 70 per cent, and 58 per cent. The developing countries’ average is 54 per cent, 50 per cent, and 46 per cent, and world average is 62 per cent, 58 per cent, and 54 per cent.
Commenting on accounts penetration in the BRICS countries—Brazil, the Russian Federation, India, China, and South Africa—the report said, “Among these five countries, China has the highest share of adults with an account, at 79 percent. South Africa has the highest share of adults who reported using an account to make or receive payments, at 60 percent, followed by the Russian Federation with 51 percent. In Brazil and China about 40 percent of adults reported using an account to make or receive payments.”
As against these countries, the report said, “in India not only is account penetration comparatively low, at 53 per cent, but so is the use of accounts for payments: a mere 15 per cent of adults reported using an account to make or receive payments.”
Comparing account penetration of India and China, the report said, both “saw strong growth in account ownership between 2011 and 2014—in China account penetration increased from 64 percent to 79 percent, and in India from 35 percent to 53 percent.” 
Translated into absolute numbers, it added, “this growth means that 180 million adults in China and 175 million in India became account holders—with the two countries together accounting for about half the 700 million new account holders globally.”
Despite this, the report said, “India is home to 21 per cent of the world’s unbanked adults”, while China accounts for “12 per cent of the world’s unbanked adults.” It added, “India, with a dormancy rate of 43 per cent, accounts for about 195 million of the 460 million adults with a dormant account around the world.” This is against the western economies, where the “dormancy rate is 5 per cent.”
The report also points out that as against the less than 5 per cent of adults around the world reported borrowing from a private informal lender, by contrast, in India and Nepal, “more than 13 percent of adults reported borrowing from a private informal lender.”
In South Asia about 40 percent have an account classified as dormant. One possible reason for this is the large number of accounts opened within the past year in India, many of which were set up without an explicit purpose in mind.

Comments

TRENDING

A Hindu alternative to Valentine's Day? 'Shiv-Parvati was first love marriage in Universe'

By Rajiv Shah*   The other day, I was searching on Google a quote on Maha Shivratri which I wanted to send to someone, a confirmed Shiv Bhakt, quite close to me -- with an underlying message to act positively instead of being negative. On top of the search, I chanced upon an article in, imagine!, a Nashik Corporation site which offered me something very unusual. 

'Anti-poor stand': Even British wouldn't reduce Railways' sleeper and general coaches

By Anandi Pandey, Sandeep Pandey*  Probably even the British, who introduced railways in India, would not have done what the Bhartiya Janata Party government is doing. The number of Sleeper and General class coaches in various trains are surreptitiously and ominously disappearing accompanied by a simultaneous increase in Air Conditioned coaches. In the characteristic style of BJP government there was no discussion or debate on this move by the Indian Railways either in the Parliament or outside of it. 

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

Why convert growing badminton popularity into an 'inclusive sports opportunity'

By Sudhansu R Das  Over the years badminton has become the second most popular game in the world after soccer.  Today, nearly 220 million people across the world play badminton.  The game has become very popular in urban India after India won medals in various international badminton tournaments.  One will come across a badminton court in every one kilometer radius of Hyderabad.  

Faith leaders agree: All religious places should display ‘anti-child marriage’ messages

By Jitendra Parmar*  As many as 17 faith leaders, together for an interfaith dialogue on child marriage in New Delhi, unanimously have agreed that no faith allows or endorses child marriage. The faith leaders advocated that all religious places should display information on child marriage.

How embracing diversity enriched my life, brought profound sense of joy

By Mike Ghouse*  If you can shed the bias towards others, you'll love the connections with every human that God or his systems have created. This gives a sense of freedom and brings meaning and joy to life. Embracing and respecting how people dress, eat, and practice their beliefs becomes an enriching experience.

'28% rise in sedition cases': Top global NGO alliance rates India's civil space 'repressed'

By Rajiv Shah Rating India's civic space as repressed , Civicus, a global civil society alliance, in its new report submitted to the UN Human Rights Committee (UNHRC) on the state of civic space in the country has said that the use of sedition law against the Modi government’s critics continues. "Under the government of Prime Minister Narendra Modi, sedition cases have increased by 28 per cent with over 500 cases against more than 7,000 people", it says.

Ayurveda, Sidda, and knowledge: Three-day workshop begins in Pala town

By Rosamma Thomas*  Pala town in Kottayam district of Kerala is about 25 km from the district headquarters. St Thomas College in Pala is currently hosting a three-day workshop on knowledge systems, and gathered together are philosophers, sociologists, medical practitioners in homeopathy and Ayurveda, one of them from Nepal, and a few guests from Europe. The discussions on the first day focused on knowledge systems, power structures, and epistemic diversity. French researcher Jacquiline Descarpentries, who represents a unique cooperative of researchers, some of whom have no formal institutional affiliation, laid the ground, addressing the audience over the Internet.

Post-poll mob lynching spree, bulldozer justice: NAPM seeks united resistance

Counterview Desk  Condemning what it calls "the horrific spree of mob lynchings across the country after the Lok Sabha election results", India's premier civil society network, National Alliance of People’s Movements (NAPM), has called for "united resistance" against "hateful communal politics, mob lynching of religious minorities and caste-based oppression".