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LATEST NEWS UPDATES | Will smart cards help those living below poverty line? by Binay Singh

Will smart cards help those living below poverty line? by Binay Singh

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published Published on Sep 14, 2010   modified Modified on Sep 14, 2010


`Financial Inclusion' as defined by the committee of financial inclusion is the process of ensuring access to financial services and timely and adequate credit, where needed by vulnerable groups, such as weaker sections and lower income groups at an affordable cost.

Reserve Bank of India (RBI) has selected Baikunthpur village in Narayanpur block of Mirzapur district to provide banking services to the villagers under its financial inclusion programme. The programme was launched by deputy governor of RBI, K C Chakrabarty, with the distribution of smart cards to some of the villagers at a function on Monday.

The RBI deputy governor hoped that the financial inclusion programme would bring a qualitative change in the lives of rural folks in the country. It is a pro-people initiative of RBI to connect the common people of rural India to the banking system for their growth.

But, a basic question remains unanswered -- how the rural households earning less than Rs 250 a month or getting less than one square meal per day for major part of the year can get the advantage of financial inclusion programme. However, Chakrabarty said that the development of technology would make the facility reach maximum number of people.

According to official data, Mirzapur district, where the RBI deputy governor made a visit on Monday to launch the programme, has thousands of such rural households which are below poverty line (BPL) and living in acute penury. According to the records of BPL Census, 2002, there are 3,037 rural households, whose monthly income is less than Rs 250, and 90,423 such households in the district get less than one square meal per day. Out of 3,41,451 BPL rural households only 7,724 families have average monthly income of more than Rs 2,500 per month, and only 18,485 such households get two square meals per day with occasional shortage.

It was difficult for the RBI officials to convince how such families of average size of 4-5 members could be benefited through the financial inclusive programme. However, there are programmes like Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) to facilitate the rural population. But, it is beyond imagination that a family can meet all expenses in a meagre income of less than Rs 250 a month.

Mirzapur district is not alone, but districts like Varanasi, Chandauli and Sonbhadra also have a number of vulnerable groups, who need financial services. In Varanasi district, there are 9,257 households whose monthly income is less then Rs 250, while the number of such families in Chandauli and Sonbhadra districts is 12,244 and 4,176, respectively.


The Times of India, 13 September, 2010, http://timesofindia.indiatimes.com/city/kanpur/Will-smart-cards-help-those-living-below-poverty-line/articleshow/6548795.cms


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