Government Exams Made Easy

Government Schemes/Programs and

Initiatives on
Financial Inclusion
Government Schemes – Financial Inclusion

Table of Contents

Contents Page No.

A. Summarized Table 3
B. Schemes in Details 5
1. RBI Retail Direct Scheme 5
2. Reserve Bank- Integrated Ombudsman Scheme 6
3. Pradhan Mantri Jan Arogya Yojana (PM-JAY) 6
4. Pradhan Mantri Vaya Vandana Yojana (PMVVY) 6
5. Stand Up India 7
6. Atal Pension Yojana (APY) 8
7. Credit Enhancement Guarantee Scheme for Scheduled Castes (CEGSSC) 8
8. PM Mudra Yojna 9
9. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) 10
10. Pradhan Mantri Suraksha Bima Yojana (PMSBY) 11
11. Start Up India 11
12. Sukanya Samriddhi Account Scheme 12
13. Suraksha Bandhan 13
14. Venture Capital Fund for Scheduled Castes 13
15. Pradhan Mantri Jan Dhan Yojana (PMJDY) 13
16. Varishtha Pension Bima Yojana (VPBY) 14
17. Rashtriya Swastha Bima Yojna (RSBY) 14
18. Aam Aadmi Bima Yojana (AABY) 15
19. National Pension Scheme (NPS) 16
20. Kisan Vikas Patra 16
C. National Strategy for Financial Inclusion (NSFI) 2019-24 18

2
Government Schemes – Financial Inclusion

A. Summarized Table

Programs and Schemes

S. Scheme Launch Implementing Budget
Key Objective Category Details
No. Name Year Ministry* Allocation*

RBI Retail
Click
1 Direct 2021 RBI To Enable retail investor in G-Sec
Here
Scheme

Integrated
For timely grievance redressal of Click
2 Ombudsman 2021 RBI
customers Here
Scheme

Pradhan Aims to provide health protection

Mantri Jan Ministry of cover to poor and vulnerable Centrally Rs. 3142
Click
3 Arogya 2018 Health and families against financial risk Sponsored Crore
Here
Yojana Family Welfare arising out of catastrophic health Scheme (2022-23)
(PM-JAY) episodes
Pradhan
Ministry of To protect elderly persons aged 60
Mantri Vaya Rs. 474
Finance; years and above against a future Click
4 Vandana 2017 - Crore
Administered fall in their interest income due to Here
Yojana (2022-23)
by LIC the uncertain market conditions
(PMVVY)

Stand Up Ministry of For facilitating credit to SC/ST and Click

5 2016 -
India Finance Women entrepreneurs Here

To address the longevity risks

Ministry of
among the workers in unorganized Rs. 200
Atal Pension Finance; Click
6 2015 sector and to encourage the - Crore
Yojana (APY) Administered Here
workers in unorganized sector to (2022-23)
by PFRDA
voluntarily save for their retirement
Credit
Ministry of
Enhancement
Social Justice To promote entrepreneurship
Guarantee Central
& amongst the Scheduled Castes Click
7 Scheme for 2015 Sector -
Empowerment; (SCs), by providing Credit Here
Scheduled Scheme
IFCI (Nodal Enhancement Guarantee
Castes
Agency)
(CEGSSC)
Developing the micro enterprise
Rs. 100
PM Mudra Ministry of sector in the country by extending Click
8 2015 - Crore
Yojna Finance various support including financial Here
(2022-23)
support in the form of refinance
Pradhan
A one year life insurance
Mantri Jeevan
Ministry of scheme, renewable from year to Click
9 Jyoti Bima 2015 - -
Finance year, offering coverage for death Here
Yojana
due to any reason
(PMJJBY)
Pradhan
An accident insurance scheme,
Mantri
Ministry of offers a one-year accidental death Click
10 Suraksha 2015 - -
Finance and disability cover, which can be Here
Bima Yojana
renewed annually
(PMSBY)
To build a strong eco-system for
nurturing innovation and Startups
Ministry of
in the country that will drive Click
11 Start Up India 2015 Commerce and -
sustainable economic growth and Here
Industry
generate large scale employment
opportunities.
Sukanya Ministry of A small deposit scheme for the girl
Samriddhi Women and child launched as a part of the Click
12 2015 - -
Account Child 'Beti Bachao Beti Padhao' Here
Scheme Development campaign

3
Government Schemes – Financial Inclusion

Programs and Schemes

S. Scheme Launch Implementing Budget
Key Objective Category Details
No. Name Year Ministry* Allocation*

A drive which aims to take forward

Suraksha Ministry of the Government’s objective of Click
13 2015 - -
Bandhan Finance creating a universal social security Here
system in the country
Ministry of
Venture Social Justice To promote entrepreneurship in
Capital Fund & India among the Scheduled Click
14 2015 - -
for Scheduled Empowerment; Castes by providing concessional Here
Castes IFCI (Invt finance to them.
Manager)
A National Mission on Financial
Pradhan
Inclusion to bring about financial
Mantri Jan Ministry of Click
15 2014 inclusion and provide banking - -
Dhan Yojana Finance Here
services to all households in the
(PMJDY)
country

It is a senior citizen pension

Varishtha Ministry of
scheme to provide social security
Pension Bima Finance; LIC Click
16 2014 against a future fall in their interest - -
Yojana (Implementing Here
income due to uncertain market
(VPBY) Agency)
conditions

Rashtriya To provide protection to BPL

Ministry of
Swastha households from financial liabilities Click
17 2008 Labour and - -
Bima Yojna arising out of health shocks which Here
Employment
(RSBY) involve hospitalization.

Ministry of
Aam Aadmi A government-run social security
Finance; Click
18 Bima Yojana 2007 scheme aimed at unorganised - -
Administered Here
(AABY) sector workers
by LIC
A voluntary defined contribution
National Ministry of pension scheme. However,
Pension Finance; mandatory for employees of Click
19 2004 - -
Scheme Administered central government (except Armed Here
(NPS) by PFRDA Forces) and Central Autonomous
Bodies
A certificate scheme from the
Kisan Vikas Ministry of Indian post office to encourage Click
20 1998 - -
Patra Finance long-term financial discipline in Here
people
* Based on Notes of Demands for Grants 2020-2021

4
 Government Schemes – Financial Inclusion

B. Financial Inclusion Related Schemes

Introduction
According to the Committee on Financial Inclusion (Chairman: Dr C Rangarajan, RBI, 2008) financial inclusion
has been defined as “the process of ensuring access to financial services, timely and adequate credit for
vulnerable groups such as weaker sections and low-income groups at an affordable cost”.

India began its financial inclusion journey as early as in 1956 with the nationalisation of Life Insurance
companies. This was followed by nationalisation of banks in 1969 and 1980. The general insurance companies
were nationalised in 1972. Some of the important schemes which are promoting financial inclusion in India are
listed below:

1. RBI Ratil Direct Scheme

Launched on 12 November 2021
Objective:
To facilitate investment in Government Securities by individual investors.
Features/Scope:

 Retail investors (individuals) will have the facility to open and maintain the ‘Retail Direct Gilt Account’
(RDG Account) with RBI.
 RDG Account can be opened through an ‘Online portal’ provided for the purpose of the scheme.
 The ‘Online portal’ will also give the registered users the following facilities:
o Access to primary issuance of Government securities

o Access to NDS-OM. (NDS-OM means RBI’s screen based, anonymous electronic order matching
system for trading in Government securities in the secondary market)

Eligibility:

 Retail investors, as defined under the scheme, can register under the Scheme and maintain a RDG
Account, if they have the following:

1. Permanent Account Number (PAN) issued by the Income Tax Department;

2. Access to primary issuance of Government securities
3. Any officially valid document (OVD) for KYC purpose;
4. Valid email id; and
5. Registered mobile number

 Non-Resident retail investors eligible to invest in Government Securities under Foreign Exchange
Management Act, 1999 are eligible under the scheme.
 The RDG account can be opened singly or jointly with another retail investor who meets the eligibility
criteria.

2. Integrated Ombudsman Scheme

Launched on 12 Nov 2021
About:

 It amalgamates three ombudsman schemes of RBI - banking ombudsman scheme of 2006, ombudsman
scheme for NBFCs of 2018 and ombudsman scheme of digital transactions of 2019.

5
 Government Schemes – Financial Inclusion

 The unified ombudsman scheme will provide redress of customer complaints involving deficiency in services
rendered by RBI regulated entities viz. banks, NBFCs (Non banking Financial Companies) and pre-paid
instrument players if the grievance is not resolved to the satisfaction of the customers or not replied within a
period of 30 days by the regulated entity.

 It also includes non-scheduled primary co-operative banks with a deposit size of Rs 50 crore and above.
The integrated scheme makes it a “One Nation One Ombudsman’ approach and jurisdiction neutral.
Features:

 It will no longer be necessary for a complainant to identify under which scheme he/she should file
complaint with the Ombudsman.
 The Scheme defines ‘deficiency in service’ as the ground for filing a complaint, with a specified list of
exclusions. Therefore, the complaints would no longer be rejected simply on account of “not covered
under the grounds listed in the scheme”.
 The Scheme has done away with the jurisdiction of each ombudsman office.
 A Centralised Receipt and Processing Centre has been set up at RBI, Chandigarh for receipt and initial
processing of physical and email complaints in any language.
 The responsibility of representing the Regulated Entity and furnishing information in respect of complaints
filed by customers against the Regulated Entity would be that of the Principal Nodal Officer in the rank of a
General Manager in a Public Sector Bank or equivalent.
 The Regulated Entity will not have the right to appeal in cases where an Award is issued by the
ombudsman against it for not furnishing satisfactory and timely information/documents.

 The Executive Director-in charge of Consumer Education and Protection

Department of RBI would be the Appellate Authority under the Scheme

3. Pradhan Mantri Jan Arogya Yojana (PM-JAY)

 Launched in 2018 as part of Ayushman Bharat.

 Also known as National Health Protection Scheme. It is the world’s largest government funded health care
programme
 The scheme subsumed two centrally sponsored schemes, namely, Rashtriya Swasthya Bima Yojana
(RSBY) and the Senior Citizen Health Insurance Scheme.

Target
 The scheme is targeted at poor, deprived rural families and identified occupational category of urban
workers' families.
 Aims to cover over 10.7 crore poor and vulnerable families (approximately 50 crore beneficiaries)

Eligibility
 Families who are identified by the government on the basis of deprivation and occupational criteria using the
SECC database, both in rural and urban areas, are entitled for AB-NHPM.
o No cap on family size and age of members.
 Priority to girl child, women and senior citizens.

Benefit
 Providing coverage upto 5 lakh rupees per family per year for secondary and tertiary care hospitalization
 The scheme will be cashless and paperless at public hospitals and empanelled private hospitals.

4. Pradhan Mantri Vaya Vandana Yojana (PMVVY)

6
 Government Schemes – Financial Inclusion

Launched in 2017 with an aim to protect elderly persons aged 60 years and above against a future fall in their
interest income due to the uncertain market conditions

Eligibility
 Minimum entry age: 60 years (completed)
 Maximum entry age: No limit

Features
 This is a scheme offered by the Life insurance Corporation
(LIC) of India gives a guaranteed payout of pension at a
specified rate for 10 years.
 It also offers a death benefit in the form of return of purchase Minimum Maximum
price to the nominee. Monthly Monthly
Pension Pension
Rs. 1,000 Rs. 9,250
Investment and Benefits
 Investment
o The minimum investment has also been revised to
Rs.1,56,658 for pension of Rs.12,000 per annum and Rs.1,62,162 for getting a minimum pension
amount of Rs.1,000 per month under the scheme.
o The maximum investment that can be made in PMVVY is restricted to Rs 15 lakh per senior citizen

 Benefits
o Maturity benefit: If the pensioner survives till the end of the policy term of 10 years, purchase price
of the annuity along with final pension instalment will be payable to the policyholder.
o Death benefit: If the pensioner dies during the policy term of 10 years, the purchase price of the
annuity scheme will be refunded to the beneficiary.

Recent Development
 The scheme has been extended till March 31, 2023 (previously it was open till March 31, 2020)
 Assured return of 7.40% per annum for FY 2020-21
 The rate of return will be reset annually on April 1st of every new financial year
o Finance Minister to approve annual reset rate of return at the beginning of every financial year.
o Annual reset of assured rate of interest with effect from April 1st of financial year in line with revised
rate of returns of Senior Citizens Saving Scheme (SCSS) upto a ceiling of 7.75% with fresh appraisal
of the scheme on breach of this threshold at any point.
 Capping Management expenses at 0.5% p.a. of funds of the scheme for first year of scheme in respect of
new policies issued and thereafter 0.3% p.a. for second year onwards for the next 9 years.

5. Stand Up India

Launched in 2016 for facilitating credit to SC/ST and Women entrepreneurs Accessbility of Loans
The scheme covers all branches of Scheduled Commercial Banks and will be
accessed in three ways (shown in the figure) Directly at
Branch
Assistance Through SIDBI’s
 Bank loans between Rs.10 lakh and Rs. 1 crore to SC/ ST borrower and Stand Up India
portal
woman borrower for setting up a greenfield enterprise.
Through the Lead
 The scheme provides financial assistance (funded /non-funded) for District Manager
working capital, acquisition of fixed assets in manufacturing, services or
retail sector.

Eligibility

7
 Government Schemes – Financial Inclusion

 SC/ST and/or woman entrepreneurs, above 18 years of age

 In case of non-individual enterprises, 51% of the shareholding and controlling stake should be held by either
SC/ST and/or Women Entrepreneur
 Borrower should not be in default to any bank/financial institution

Tenor of Loan

Repayable in 7 years with a maximum moratorium period of 18 months

Size of Loan

Composite loan of 75% of the project cost inclusive of term loan and working capital

Interest Rate

Lowest applicable rate of bank for that category not to exceed base rate (MCLR) +3%+tenor premium

6. Atal Pension Yojana (APY)

 Launched in 2015 to address the longevity risks among the workers in unorganized sector and to encourage
the workers in unorganized sector to voluntarily save for their retirement
 The scheme is administered by the Pension Fund Regulatory and Development Authority (PFRDA) through
NPS architecture.

Eligibility
 APY is applicable to all citizen of India aged between 18-40 years.
 Aadhaar will be the primary KYC. Aadhar and mobile number are recommended to be obtained from
subscribers for the ease of operation of the scheme. If not available at the time of registration, Aadhar
details may also be submitted later stage.

Benefits
 Under the APY, there is guaranteed minimum monthly pension for the subscribers ranging between Rs.
1,000 and Rs. 5,000 per month.
 The benefit of minimum pension would be guaranteed by the Government of India (GoI).

Government contribution
 GoI will co-contribute 50% of the subscriber’s contribution or Rs. 1,000 per annum, whichever is lower.
Government co-contribution is available for those who are not covered by any Statutory Social Security
Schemes and is not income tax payer.
 GoI will co-contribute to each eligible subscriber, for a period of 5 years who joins the scheme between the
period 1st June, 2015 to 31st December, 2015. The benefit of five years of government Co-contribution
under APY would not exceed 5 years for all subscribers including migrated Swavalamban beneficiaries.

Exit
 On attaining the age of 60 years: The exit from APY is permitted at the age with 100% annuitisation of
pension wealth. On exit, pension would be available to the subscriber.
 In case of death of the Subscriber due to any cause: In case of death of subscriber pension would be
available to the spouse and on the death of both of them (subscriber and spouse), the pension corpus would
be returned to his nominee.
 Exit Before the age of 60 Years: Exit before 60 years of age is not permitted however it is permitted only in
exceptional circumstances, i.e., in the event of the death of beneficiary or terminal disease.

8
 Government Schemes – Financial Inclusion

7. Credit Enhancement Guarantee Scheme for Scheduled Castes (CEGSSC)

Launched in 2015 with the aim to promote entrepreneurship amongst the Scheduled Castes (SCs), by providing
Credit Enhancement Guarantee to Member Lending Institutions (MLIs), who shall be providing financial
assistance to these entrepreneurs. Initial Capital allocation was of Rs. 200 Crore.

Objective
 It is a Social Sector Initiative to be implemented nationally in order to promote entrepreneurship among the
scheduled caste population in India.
 Promote entrepreneurship amongst the Scheduled Castes who are oriented towards innovation and growth
technologies.
 To support, by way of providing Credit Enhancement Guarantee to Banks and Financial Institutions, who will
be providing financial assistance to the Scheduled Caste Entrepreneurs, who in turn will create wealth,
value for the society, create jobs and ultimately will develop confidence and at the same time promote
profitable businesses.
 To promote financial inclusion for SC entrepreneurs and to motivate them for further growth of SC
communities.
 To facilitate economic development of SC entrepreneurs.
 To enhance direct and indirect employment generation for SC population in India

Nodal Agency

IFCI Ltd. has been designated as the Nodal Agency under the scheme, to issue the guarantee cover in favour of
MLIs, who shall be encouraged to finance SCs entrepreneurs to boost entrepreneurship amongst the marginal
strata of the society.

Eligibility

Registered Companies and Societies/Registered Partnership Firms/Sole Proprietorship firms/Individual SC

Entrepreneur having more than 51% shareholding by SC entrepreneurs/promoters/members with the
management control for the past 6 months are eligible for guarantee from IFCI Ltd. against the loans extended
by MLIs Bank / Institutions.

Amount of Guarantee cover

Minimum Rs.15 Lakh & Maximum. Rs 5 Crore

Tenure of Guarantee

Maximum 7 years or repayment period whichever is earlier

8. PM Mudra (Micro Units Development and Refinance Agency) Yojana

Launched in 2015 and is aimed at empowering the neglected and underprivileged sections of the society

MUDRA is a refinancing Institution. MUDRA does not lend directly to the micro entrepreneurs / individuals.
Mudra loans under Pradhan Mantri Mudra Yojana (PMMY) can be availed of from nearby branch office of a bank,
NBFC, Micro Finance Institutions (MFIs) etc.

Genesis
MUDRA has been initially formed as a wholly owned subsidiary of Small Industries Development bank of India
(SIDBI) with 100% capital being contributed by it. Presently, the authorized capital of MUDRA is 1000 crores and
paid up capital is 750 crore, fully subscribed by SIDBI

Objectives

9
 Government Schemes – Financial Inclusion

Developing the micro enterprise sector in the country by extending various support including financial support in
the form of refinance, so as to achieve the goal of funding the unfunded

Eligibility for Availing Loan

Any Indian Citizen who has a business plan for a
non-farm income generating activity such as
manufacturing, processing, trading or service
sector whose credit need is up to Rs. 10 lakh
can approach either a Bank, MFI or NBFC for
availing of MUDRA loans under PMMY. The
Shishu : Kishor : Tarun :
usual terms and conditions of the lending Covering loans Covering loans Covering loans
agency may have to be followed for availing of upto Rs. above Rs. above 5 lakh
loans under PMMY. The lending rates are as per 50,000 50,000 and and upto 10
the RBI guidelines issued in this regard from upto Rs. 5 lakh lakh
time to time.

Purpose of Loan
Mudra loan is extended for a variety of purposes
which provides income generation and
employment creation in non-farm activities
(Manufacturing, Services, Retail and Agriculture Allied Activities).

Type of Loan
The assistance have been named 'Shishu', 'Kishore' and 'Tarun' to signify the stage of growth / development and
funding needs of the beneficiary micro unit / entrepreneur

The funding support from MUDRA is of two types:

 Micro Credit Scheme (MCS) for loans up to 1 lakh finance through MFIs.
 Refinance Scheme for Commercial Banks / Regional Rural Banks (RRBs) / Small Finance Banks / Non
Banking Financial Companies (NBFCs).

Repayment of Loan
 Term Loan: To be repaid in suitable installments with suitable moratorium period as per cash flow of the
business.
 Over Draft & Cash Credit Limit: Repayable on demand. Renewal and Annual Review as per internal
guidelines of the Bank.

Interest Rate on Loans

Interest rate Interest rates are to be charged as per the policy decision of the bank.

Tenor of Loan
Based on the economic life of the assets created and also the cash flow generated. However, MUDRA’s
refinance assistance will be for a maximum tenor of 36 months

MUDRA Card
 A debit card issued against the MUDRA loan account, for working capital portion of the loan. The borrower
can make use of MUDRA Card in multiple drawals and credits, so as to manage the working capital limit in
cost-efficient manner and keep the interest burden minimum.
 MUDRA Card can be operated across the country for withdrawal of cash from any ATM / micro ATM and
also make payment through any ‘Point of Sale’ machines.

9. Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY)

Launched in 2015

10
 Government Schemes – Financial Inclusion

Eligibility
 Available to people in the age group of 18 to 50 years having a bank account who give their consent to join /
enable auto-debit.
 Aadhar would be the primary KYC for the bank account.

Features
 The life cover of Rs. 2 lakhs shall be for the one year period stretching from 1st June to 31st May and will be
renewable
 The premium is Rs. 330 per annum
 The scheme is being offered by Life Insurance Corporation and all other life insurers who are willing to offer
the product on similar terms with necessary approvals and tie up with banks for this purpose.
 A person can join PMJJBY with one Insurance company with one bank account only.
 Termination of Assurance due to
o On attaining age 55 years (age near birth day) subject to annual renewal up to that date (entry,
however, will not be possible beyond the age of 50 years), or
o Closure of account with the Bank or insufficiency of balance to keep the insurance in force.

10. Pradhan Mantri Suraksha Bima Yojana(PMSBY)

Launched in 2015

Eligibility
 People in the age group 18 to 70 years with a bank account who give their consent to join / enable auto-
debit on or before 31st May for the coverage period 1st June to 31st May on an annual renewal basis.
 Aadhar would be the primary KYC for the bank account
 In the case of a joint account, all holders of the account can join the scheme.
 Even NRIs are eligible, but if a claim arises, the claim benefit will be paid to the beneficiary/nominee only in
Indian currency.

Features
 The risk coverage under the scheme is Rs.2 lakh for accidental death and permanent total disability and Rs.
1 lakh for partial disability.
 The premium of Rs. 12 per annum is to be deducted from the account holder’s bank account through ‘auto-
debit’ facility in one installment.
 The scheme is being offered by Public Sector General Insurance Companies or any other General
Insurance Company who are willing to offer the product on similar terms
 The cover will be in addition to any other insurance plan the subscriber has. The scheme is not a Mediclaim,
that is, there is no provision for reimbursement of hospitalisation expenses following accident, resulting in
death or disability.

Coverage
Accidents, any death or disability (as defined under PMSBY) resulting from natural calamities is covered under
PMSBY. Death due to suicide is not covered

11. Start Up India

Launched in 2015 to build a strong eco-system for nurturing innovation and Startups in the country that will drive
sustainable economic growth and generate large scale employment opportunities.

11
 Government Schemes – Financial Inclusion

Further to this, an Action Plan for Startup India was unveiled by Prime Minister of India on 16th January, 2016.
The Action Plan comprises of 19 action items spanning across areas such as “Simplification and handholding”,
“Funding support and incentives” and “Industry-academia partnership and incubation”.

Meaning of Startup
 Startup means an entity, incorporated or registered in India not prior to five years, with annual turnover not
exceeding Rs. 25 crore in any preceding financial year, working towards innovation, development,
deployment or commercialization of new products, processes or services driven by technology or intellectual
property.
 Provided that such entity is not formed by splitting up, or reconstruction, of a business already in existence.
 Provided also that an entity shall cease to be a Startup if its turnover for the previous financial years has
exceeded Rs. 25 crore or it has completed 5 years from the date of incorporation/ registration.
 Provided further that a Startup shall be eligible for tax benefits only after it has obtained certification from the
Inter-Ministerial Board, setup for such purpose.

Mechanism

There is no provision under Startup India initiative for sanctioning of funds to startups directly. However,
Government of India has established a Fund of Funds for Startups (FFS) with corpus of Rs. 10,000 crores, to
meet the funding needs of startups. Department for Promotion of Industry and Internal Trade (DPIIT) is the
monitoring agency and Small Industries Development Bank of India (SIDBI) is the operating agency for FFS.

Features

Can be divided under 3 heads as shown below

Simplification and Funding support and Industry-Academia

Handholding Incentives partnership and Incubation

• Compliance Regime based
on Self-Certification with an
objective to reduce the
regulatory burden on
Startups thereby allowing
them to focus on their core
business and keep
compliance cost low
• Startup India Hub with an
objective to create a single
point of contact for the entire
Startup ecosystem and
enable knowledge exchange
and access to funding.
• Faster Exit for Startups with
an objective to make it easier
for Startups to wind up
operations.
• Rolling out of Mobile App and
Portal
• Relaxed Norms of Public
Procurement for Startup
• Credit Guarantee fund for • Launch of Atal Innovation
Startupswith objective to Mission (AIM) with an
catalyze entrepreneurship by objective to serve as a
providing credit to innovators platform for promotion of
across all sections of society world-class Innovation Hubs,
Grand Challenges, Startup
• Tax Exemptions on Capital businesses and other self-
Gains with an objective to employment activities,
promote investments into particularly in technology
Startups by mobilizing the driven areas.
capital gains arising from
sale of capital assets. • Harnessing Private Sector
Expertise for Incubator Setup
• Tax Exemptions to startups
for 3 Years with an objective • Building Innovation Centers
to promote the growth of at National Institutes
Startups and address
working capital requirements. • Launching of Innovation
Focused Programs for
• Providing Funding Support Students
through Fund of Funds with a
Corpus of Rs. 10,000 crores • Annual Incubator Grand
Challenge
• Tax Exemption on
Investments above Fair
Market Value

12. Sukanya Samriddhi Account Scheme

12
 Government Schemes – Financial Inclusion

Launched in 2015 as a small deposit scheme for the girl child launched as a part of the 'Beti Bachao Beti
Padhao' campaign

Eligibility
 Account can be opened in the name of a girl child till she attains the age of 10 years.
o A girl child is eligible for this account only if she is a resident Indian citizen when the account is
opened, and remains so until the maturity or the closure of account.
 Only one account can be opened in the name of a girl child.

Features
 Account can be opened in Post office and branches of authorised banks.
 Account can be opened with a minimum of Rs. 250 and thereafter any amount in multiple of Rs. 100 can be
deposited. A minimum of Rs. 250 must be deposited in a financial year.
 Maximum Rs. 1,50,000 can be deposited in a financial year.
 One withdrawal shall be allowed on attaining the age of 18 years of account holder to meet education
expenses upto 50 % of the balance at the credit of preceding financial year.
 The account can be transferred anywhere in India from one post office/bank to another.
 The account shall mature on completion of 21 years from the date of opening of account or on the marriage
of Account holder whichever is earlier.

Rate of Interest
 Interest as may be notified by the government from time to time will be calculated on yearly compounded
basis and credited to the account.
 From April 2020, this scheme offers an interest rate of 7.6% compounded annually.

13. Suraksha Bandhan

 Launched in 2015
 It is a drive which aims to take forward the Government’s objective of creating a universal social security
system in the country, targeted especially at the poor and the under-privileged
o Facilitate enrolment under Pradhan Mantri Suraksha Bima Yojana (PMSBY) and Pradhan Mantri
Jeevan Jyoti Bima Yojana (PMJJBY)
 The drive will be supported through the Jeevan Suraksha Gift cheques, which will be available for purchase
for Rs 351 in bank branches by persons wishing to gift them to facilitate one year payment of premium for
Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) and Pradhan Mantri Suraksha Bima Yojana (PMSBY)
by the recipient.

14. Venture Capital Fund for Scheduled Castes

Launched in 2015 as a Social Sector Initiative to be implemented nationally in order to promote entrepreneurship
among the Scheduled Castes population in India. Total corpus of Rs. 330 crore

Eligibility
 Manufacturing, Services and allied sectors including startups with long tenure of upto 8 years
 While selecting the SC entrepreneurs, women and disabled SC entrepreneurs would be preferred
 Companies having at least 60% stake holdings by Scheduled Castes entrepreneurs for the past 12 months
with management control, or
o a new Company provided that the new Company is a successor entity of a proprietary firm or
Partnership firm or One Person Company (OPC) or Limited Liability Partnership (LLP) of any other
establishment incorporated under any law in force, with sound business model which has been in

13
 Government Schemes – Financial Inclusion

operation for over 12 months, and the predecessor entity had at least 60% shareholding of the
Scheduled Castes promoters with management control.
 Documentary proofs of being SC will have to be submitted by the entrepreneurs at the time of submitting the
proposals

Size of Assistance

Rs. 20 Lakhs to Rs. 15 crores

Funding Pattern

Category Maximum Funding Promoters’ Share Balance (if any)

Financial assistance
75% of project cost 25% of project cost -
upto Rs. 5 crore
25% of project cost by
Financial assistance
50% of project cost 25% of project cost promoters or financial
above Rs. 5 crore
institutions

Tenure
Upto 8 years including moratorium period

Investment manager
IFCI Venture Capital Funds

15. Pradhan Mantri Jan Dhan Yojna (PMJDY)

 Launched in 2014 and aims to provide universal access to banking facilities with at least one basic banking
account for every household, financial literacy, access to credit, insurance and pension.
 Under the scheme, a basic savings bank deposit (BSBD) account can be opened in any bank branch or
Business Correspondent (Bank Mitra) outlet, by persons not having any other account.

Features
 No requirement to maintain any minimum balance in PMJDY accounts
 Interest is earned on the deposit in PMJDY accounts.
 Rupay Debit card is provided to PMJDY account holder.
 Life Insurance Cover of Rs. 30,000 to eligible PMJDY account holders who opened their account for the first
time between 15.8.2014 to 31.1.2015 is available.
 PMJDY accounts are eligible for Direct Benefit Transfer (DBT), Pradhan Mantri Jeevan Jyoti Bima Yojana
(PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY), Atal Pendion Yojana (APY), and Micro Units
Development & Refinance Agency Bank (MUDRA) scheme.

Recent Developments
The Government has decided to extend the comprehensive PMJDY program beyond Aug 2018 with the change
in focus on opening accounts from “every household” to “every adult”, with following modification:
 Existing Overdraft (OD) limit of Rs. 5,000 revised to Rs. 10,000.
o No conditions attached for active PMJDY accounts availing OD upto Rs. 2,000.
 Age limit for availing OD facility revised from 18-60 years to 18-65 years.
 The accidental insurance cover for new RuPay card holders raised from existing Rs.1 lakh to Rs. 2 lakh to
new PMJDY accounts opened after 28 Aug 2018.
Approximately 40.4 Crore beneficiaries have been banked so far with Rs.1.31 Lakh Crore Balance in beneficiary
accounts

16. Varishtha Pension Bima Yojana (VPBY)

14
 Government Schemes – Financial Inclusion

It is a senior citizen pension scheme to provide social security against a future fall in their interest income due to
uncertain market conditions

Historical Background
The Finance Minister in his Budget Speech for the year 2014-15 proposed to revive the scheme for a limited
period from 15 August, 2014 to 14 August, 2015.

Accordingly, the revived Varishtha Pension Bima Yojana (VPBY) was formally launched by the Finance Minister
on 14.08.2014 and has been opened during the window stretching from 15th August, 2014 to 14th August, 2015.

Nodal Agency
The scheme is administered through Life Insurance Corporation of India (LIC)

Mechanism
 Under the Scheme the subscribers on payment of a lump sum amount get pension at a guaranteed rate of
8% per annum (payable monthly) for 10 years.
 Option to opt for pension on a monthly/ quarterly/half yearly and annual basis.
 Any gap in the guaranteed return over the return generated by the LIC on the fund is compensated by
Government of India by way of subsidy payment in the scheme.

Eligibility
A person should be of at least 60 years.
17. Rashtriya Swastha Bima Yojna (RSBY)

RSBY has been launched by Ministry of Labour and Employment in 2008 to provide health insurance coverage
for Below Poverty Line (BPL) families

Objective

To provide protection to BPL households from financial liabilities arising out of health shocks that involves
hospitalization.

Eligibility
 Unorganized sector workers belonging to BPL category and their family members (a family unit of five) shall
be the beneficiaries under the scheme.
 It will be the responsibility of the implementing agencies to verify the eligibility of the unorganized sector
workers and his family members who are proposed to be benefited under the scheme.
 The beneficiaries will be issued smart cards for the purpose of identification.

Benefits

The beneficiary shall be eligible for such in - patient health care insurance benefits as would be designed by the
respective State Governments based on the requirement of the people/ geographical area. However, the State
Governments are advised to incorporate at least the following minimum benefits in the package / scheme:

 Total sum insured would be Rs. 30,000/- per family per annum on a family floater basis.
 Cashless attendance to all covered ailments

Funding Pattern
 Contribution by Government of India: 75% of the estimated annual premium of Rs. 750, subject to a
maximum of Rs. 565 per family per annum.
 Contribution by respective State Governments: 25% of the annual premium, as well as any additional
premium.
 The beneficiary would pay Rs. 30 per annum as registration/renewal fee.

15
 Government Schemes – Financial Inclusion

18. Aam Aadmi Bima Yojana (AABY)

Launched in 2007 and aims to provide coverage to the head of the family or one earning member in the family.

Historical Perspective

Ministry of Finance had approved for the merger of Social Security Schemes viz., Aam Aadmi Bima Yojana
(AABY) and Janashree Bima Yojana (JBY). The merged scheme was hence renamed “Aam Aadmi Bima Yojana”
and has come into effect from January 1, 2013.

Eligibility
 The member to be covered should be aged between 18 and 59 years
 The applicant ideally should be the head of the family or one of the earning members of a below poverty line
family (BPL) or marginally above the poverty line under identified vocational group/rural landless household.

Features
 Administered by Life Insurance Corporation (LIC)
 The premium that has to be paid by a member is charged at Rs.200 per annum for each member. 50% of
total premium is subsidized from the Social Security Fund.
o In the case of a Rural Landless Household (RLH) the remaining 50 % premium is borne by the State
Government/ Union Territory.
o In the case of other occupational group the remaining 50% premium shall be borne by the Nodal
Agency and/or State Government/ or Member and Union Territory.
Benefits

Coverage Amt. (In Rs.)

Death from natural causes 30,000
Accidental death 75,000
Permanent total disability 75,000
Partial disability 37,500
Scholarship 100 per month per child (maximum 2 child)*
* The children should be studying in Classes 9th to 12th.

19. National Pension Scheme (NPS)

 It is a voluntary defined contribution pension scheme

 Launched in 2004 for government employees. However, in 2009, it was opened to all sections.
Mechanism
Eligibility
Contribution Benefit
 Any Indian citizen between 18 and 65 years
• The scheme allows • On retirement,
can join NPS. The only condition is that the subscribers to subscribers can
person must comply with know your contribute regularly in a withdraw a part of the
pension account during corpus in a lumpsum
customer (KYC) norms. their working life. and use the remaining
 An NRI can join NPS. However, the account corpus to buy an
will be closed if there is a change in the annuity to secure a
regular income after
citizenship status of the NRI. retirement.

Features
 A contributory pension system whereby contributions from subscribers along with matching contributions
from respective governments as an employer, are collected and accumulated in an individual pension
account of the employee.
 NPS is mandatory to all employees joining services of Central Government (except Armed Forces) and
Central Autonomous Bodies on or after 1st January 2004
 Pension Fund Regulatory and Development Authority (PFRDA) is the regulator for NPS

16
 Government Schemes – Financial Inclusion

 An employee’s own contribution is eligible for tax benefits

Type of Accounts under NPS

NPS offers two accounts: Tier-I and Tier-II accounts

 Tier-I is a mandatory account. One cannot withdraw the entire money from Tier-I account till his/her
retirement. Even on retirement, there are restrictions on withdrawal on the Tier-I account
 Tier-II is voluntary account. The subscriber is free to withdraw the entire money from the Tier-II account.

Minimum Contribution
 Minimum of Rs 6,000 in Tier-I account in a financial year.
 The money invested in NPS is managed by PFRDA-registered Pension Fund Managers

Withdrawl
 At the age of 60, one must use at least 40 per cent of the corpus to buy an annuity income from a PFRDA-
listed insurance company.
o He/she can withdraw 60 per cent of the corpus tax-free.

20. Kisan Vikas Patra (KVP)

Launched in 1998 as a small saving certificate scheme. Its primary objective is to encourage long-term financial
discipline in people

Tenure

As per the latest update, the tenure for the scheme is now 124 months (10 years & 4 months) if you purchase the
certificate between 1 April 2020 and 30 June 2020.

Eligibility
 Any Indian citizen above the age of 18 years can buy a Kisan Vikas Patra from the nearest post office
 Mandatory to submit AADHAAR number as proof of identity of account holder
 A parent/guardian may invest on behalf of a minor.
 Hindu Undivided Families (HUFs) and Non-Resident Indian (NRIs) cannot invest in Kisan Vikas Patra.

Features
 KVP certificate can be used as collateral or security to avail secured loans
 Lock-in period of 2 and a half years
o Premature withdrawal after a period of 2.5 years will not attract any penalties and will also receive
interest at the applicable rate.
 There are no tax-benefits available under this scheme

Investment
 The minimum investment is Rs. 1000 and there is no upper limit
 Certificates are currently available in denominations of Rs. 1,000, Rs, 5,000, Rs. 10,000, and Rs. 50,000
 To prevent the possibilities of money laundering, the 2014 government made PAN Card proof compulsory
for investments above Rs. 50,000.
 To deposit Rs. 10 lakhs and above, one must submit income proofs
 The amount invested in a KVP is not eligible for tax rebate

Type of Certificates

17
Government Schemes – Financial Inclusion

A Kisan Vikas Patra certificate can be of the following types

Single Holder Type Certificate:
This kind of certificate is issued to
an adult for self or on behalf of a
minor or to a minor
Joint ‘A’ Type Certificate:
This type of certificate is issued
jointly to two adults, payable to
both the holders jointly or to the
survivor
Joint ‘B’ Type Certificate:
This type of certificate is issued
jointly to two adults, payable to
either of the holders or to the
survivor.

Rate of Return
 The rate of interest applicable to Kisan Vikas Patra (KVP) may change periodically based on the
announcements made by the Finance Ministry.
 The current interest rate applicable to KVP is 6.9% per annum

18
Government Schemes – Financial Inclusion

C. National Strategy for Financial Inclusion (NSFI) 2019-24

Introduction
The National Strategy for Financial Inclusion 2019-
Universal
2024 has been released by RBI. In 2015, RBI has Access to
constituted a Committee on Medium-Term Path to Financial
Services
Financial Inclusion (Chairman: Shri Deepak
Mohanty) Providing
Effective Bouquet of
NSFI sets forth the vision and key objectives of the Coordination Financial
financial inclusion policies in India to help expand Services
Vision of
and sustain the financial inclusion process at the
national level through a broad convergence of NSFI
action involving all the stakeholders in the financial 2019-24
sector.

Vision Customer Access to

To make financial service available, accessible, Protection and Livelihood and
Grievance Skill
and affordable to all the citizens in a safe and Redressal Development
transparent mannerto support inclusive and
resilient multi-stakeholder led growth Financial
Literacy and
Recommendations under NSFI Education

Universal Access to Financial Service

 Increasing outreach of banking outlets of Scheduled Commercial Banks /Payments Banks/ Small Finance
Banks, to provide banking access to every village within a 5 KM radius/ hamlet of 500 households in hilly
areas by March 2020.
 Strengthen eco-system for various modes of digital financial services in all the Tier-II to Tier VI centres to
create the necessary infrastructure to move towards a less cash society by March 2022.
 Move towards an increasingly digital and consent-based architecture for customer onboarding by March
2024
 Leverage on the developments in fin-tech space to encourage financial service providers to adopt innovative
approaches for strengthening outreach through virtual modes including mobile apps so that every adult has
access to a financial service provider through a mobile device by March 2024

Providing Basic Bouquet of Financial Services

 Every willing and eligible adult who has been enrolled under the PMJDY (including the young adults who
have recently taken up employment) to be enrolled under an insurance scheme (PMJJBY, PMSBY, etc.),
Pension scheme (NPS, APY, etc.) by March 2020
 Make the Public Credit Registry (PCR) fully operational by March 2022 so that authorised financial entities
can leverage on the same for assessing credit proposals from all citizens.

Access to Livelihood and Skill Development

 The details of the account holders including unemployed youth, and women who are willing to undergo skill
development and be a part of the livelihood programme may be shared to the concerned skill development
centres/ livelihood mission and vice versa by March 2020
 The new entrant to the financial system, if eligible and willing to undergo any livelihood/ skill development
programme, may be given the relevant information about the ongoing Government livelihood programmes
thus helping them to augment their skills

19
Government Schemes – Financial Inclusion

Financial Literacy and Education

 Expand the reach of Centers for Financial Literacy (CFL) at every block in the country by March 2024
 Develop financial literacy modules through National Centre for Financial Education (NCFE) by March 2021.

Customer Protection and Grievance Redressal

 Strengthening the Internal Grievances Redressal Mechanism of financial service providers for effectiveness
and timely response by March 2020.
 Develop a robust customer grievance portal/ mobile app which acts as a common interface for lodging,
tracking and redressal status of the grievances pertaining to financial sector collectively by all the
stakeholders by March 2021.
 Operationalize a Common Toll-Free Helpline which offers response to the queries pertaining to customer
grievances across banking, securities, insurance, and pension sectors by March 2022.

Effective Co-ordination
 A monitoring framework and a dashboard to be developed by March 2022
 Clearly articulate the responsibilities/ expectations of each of the stakeholders at the grass-root level to
ensure convergence of action between the Government/ Regulators/ financial service providers/ Civil
Society etc

20