To bring the 'financially excluded' population within the formal banking system, the Government and Reserve Bank of India (RBI) have taken the following steps:-
• Pursuant to the Budget announcement for 2008-09, the Commercial Banks and Regional Rural Banks were advised to open 250 new rural household accounts every year at each of their rural and semi urban branches.
• Government has set up two funds, with NABARD, viz., Financial Inclusion Fund and Financial Inclusion Technology Fund with an overall corpus of Rs.500 crore each, to facilitate financial services particularly among weaker sections, low income groups and in backward regions/hitherto unbanked areas.
• Banks have been advised to make available a basic banking 'no frills' account either with 'nil' or very low minimum balances.
• Banks have been advised to issue General Credit Cards to eligible beneficiaries without insistence on security, purpose or end use of credit.
• In January 2006, the RBI permitted banks to use the services of intermediaries in providing financial and banking services through the use of Business Facilitator (BF) and Business Correspondent (ÂÑ) models. In this light, banks can use Non-Governmental Organisations, Self Help Groups, Micro Finance Institutions, Post Offices and other Civil Society Organisation as intermediaries in providing financial and banking services.
Measures taken by the Government and RBI are not expected to have a negative financial impact on the banks.
This information was given by Minister of State for Finance, Shri Namo Narain Meena in written reply to a question raised in Lok Sabha today.
• Pursuant to the Budget announcement for 2008-09, the Commercial Banks and Regional Rural Banks were advised to open 250 new rural household accounts every year at each of their rural and semi urban branches.
• Government has set up two funds, with NABARD, viz., Financial Inclusion Fund and Financial Inclusion Technology Fund with an overall corpus of Rs.500 crore each, to facilitate financial services particularly among weaker sections, low income groups and in backward regions/hitherto unbanked areas.
• Banks have been advised to make available a basic banking 'no frills' account either with 'nil' or very low minimum balances.
• Banks have been advised to issue General Credit Cards to eligible beneficiaries without insistence on security, purpose or end use of credit.
• In January 2006, the RBI permitted banks to use the services of intermediaries in providing financial and banking services through the use of Business Facilitator (BF) and Business Correspondent (ÂÑ) models. In this light, banks can use Non-Governmental Organisations, Self Help Groups, Micro Finance Institutions, Post Offices and other Civil Society Organisation as intermediaries in providing financial and banking services.
Measures taken by the Government and RBI are not expected to have a negative financial impact on the banks.
This information was given by Minister of State for Finance, Shri Namo Narain Meena in written reply to a question raised in Lok Sabha today.
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