The U.S.-India Business Council (USIBC) lauded a plan announced by Indian Prime Minister Narendra Modi last week to expand financial inclusion and offer financial services to more people in India.
“American investors are grateful for the Government of India’s stewardship of the Indian economy,” USIBC Acting President Diane Farrell said. “USIBC looks forward to continuing to bolster industry’s engagement across pensions, payments, banking, insurance, and asset management.”
During his Independence Day speech, Modi announced the “Pradhan Mantri Jan Dhan Yojana,” an initiative aimed at expanding bank services to the poor.
“There are millions of families who have mobile phones but no bank accounts,” Modi said. “We have to change this scenario. Economic resources of the country should be utilized for the well-being of the poor. The change will commence from this point. This yojana will open the window.”
New accountholders will, under the plan, be issued a debit card and an insurance policy of up to approximately $1,600.
Vijay Advani, a USIBC board member and the executive vice president of Franklin Templeton Investments, said India has the opportunity to “reinvent [its] approach to financial inclusion.”
“As per the plan, the goal of ensuring access to affordable financial services including banking, investments, credit, insurance, pension facilities and most importantly, financial literacy appears to be within the reach of India’s vast population,” Advani said. “A lot however, depends on how various components of this plan come together and how effectively the government is able to scale up participation from the private, public and social sectors.”