Active accounts hover around 5 per cent in Karur
KARUR: Though the Central Government and the Reserve Bank of India have shown keen interest in driving the Financial Inclusion Scheme to success, the response from the public, especially the rural populace that was the target, has been rather lukewarm.
Though the coverage has been put at 85 per cent, the active user accounts hover around a meagre five per cent in Karur district.
The scheme aims at bringing the hitherto unreached sections of society under the banking umbrella and provide a platform for them to enjoy benefits such as apportioning savings and ushering in greater transparency and accountability in money flow to beneficiaries of government welfare schemes.
The scheme was initially launched in 2006 in Karur district and since then the governments and the RBI have been pushing hard the banks to open new accounts setting targets for every year.
The banks too initially reacted positively but when the first experiences of the public reaction dawned on them they slackened the drive. Under the Scheme, the banks go the doorsteps of the people and help them in opening and operating the accounts.
The high sounding theorisation of the government and the RBI on the Scheme goes for a six as huge sections of the public quiz the bank officials as to motive of the venture besides asking them whether they are entitled to benefit such as unsecured loans at low interest and with subsidy. This dampens the spirit of the bankers.
The persistent queries from the authorities and the RBI only forced the banks to open new accounts under the Scheme. The stipulation that wages had to be remitted to the beneficiaries through banks under the National Rural Employment Guarantee Act increased the number of accounts but with that guideline being given the go-by as the panchayats are directly giving them the wages the number of dormant accounts has risen sharply, say banking sources.
An estimated 22,000 savings accounts were opened under the Scheme in the past four years in Karur district but save for a paltry five per cent the rest are dormant, confide the sources.
Coercion or persuasion might have forced the banks to open accounts but no amount of request has enthused the public to operate the accounts.
Only increased sensitisation and awareness among the public could breathe some life into the Scheme and the RBI and the Central Government should take steps for that.