Being a civil service aspirant, part of our studies included knowing about various schemes launched by the government for the upliftment of the people living in the margins of society. A common occurring problem no-one will fail to notice was that there were several loopholes which prevented the intended beneficiaries from gaining access to these schemes. Take the case of the providing articles of necessities at subsidized rates. A major step taken towards plugging these loopholes was the Direct Transfer Benefit scheme started in the year 2013. The motive was to directly transfer the money to the intended beneficiary thereby increasing his purchasing power and improving his standard of living. However, it didn’t have the intended impact simply because a large number of people in rural India didn’t have access to banking services i.e. bank accounts. I often used to wonder what could be done at the ground level to make the rural population get access to banking services and derive benefits. The digitization of the economy was another step in trying to include more people into the mainstream by transferring financial benefits to them and bringing in transparency. The thrust was towards making every mobile phone an instrument to facilitate monetary transactions. Here again, due to lack of awareness, I used to question that how can poor people afford smartphones and internet connection to avail these services. Courtesy of the Milaap Fellowship, I was able to find the answers to my questions, which is financial literacy.
The training session in progressMahashakti Foundation, the field partner of Milaap, with whom I work with, has been working on a project named” Financial Literacy and Women Empowerment” which is supported by UKAID-SIDBI-PSIG PROGRAM. I attended one of their training programs pertaining to increasing the financial literacy of the people in very remote areas in Balangir district in Odisha. A major reason for people in rural areas not having access to bank accounts is due to the fact that banks are located in a far-off distance from the place where they live. Having a bank account and operating it means having to spend time in traveling which deters people from having bank accounts. Two hypothetical situations were also presented via a video to highlight the dangers of depending upon cash for financial transactions. The first situation was the story of a lady whose husband worked in the army and had sent money in her account. The lady had gone to the bank to withdraw the money and while she was returning two persons on a bike snatched her purse and rode away with the money. Another situation was shown where the landlord of a workshop tried to swindle a group of women by refusing to acknowledge that he had received payments for the monthly rents. However, this situation was prevented since the rent was paid via electronic transfer from the company’s account, which the group of women ran, to the landlord’s account. Thus it created a trail pertaining to the movement of the money and served as evidence. The thrust was towards going for digital banking.
The video which highlighted the benefits of Digital Banking SystemWhile all these information was being shared, I glanced at my mobile phone and saw that the tower signal was erratic and I had lost data connectivity. I yet again asked myself why the push for digital banking for rural areas, the key to which is internet connectivity. The very next moment I got my answer. The question was addressed in the video which brought forward information about various services which don’t require internet connectivity to do financial transactions such as USSD, AEPS. First, let us discuss the USDD or the Unstructured Supplementary Service Data based Mobile Banking service. This service requires an individual to have a bank account and any mobile phone having access to a GSM network. The bank account has to be linked with the mobile number which can be done over the internet, via ATMs or by a visit to the bank. The system facilitates payments up-to INR 5000 per day per customer. The AEPS or the Aadhar enabled payment system facilitates bank to bank transactions at POS(Micro ATM). Having access to the AEPS service enables one to withdraw and deposit cash, check balance as well as Aadhaar to Aadhaar funds transfer. Other digital banking facilities included the UPI and E-Wallets and POS or the Point of Sale system. However, these services require a smartphone with active internet connection something which is not available to many households in rural India.
At end of the session, more than 2/3 of the women came forward to enroll for the servicesSince the motive of the project is to raise the livelihood of women and make them empowered the audience for the program consisted of females. Sitting amidst the group of 80 females I found that the majority of them wanted to either open bank accounts or if they had bank accounts wanted to link them to these services. However, the organizers of the program asked them to settle down and told them that there was more information to follow. The next half of the session was how one could use their bank accounts to avail benefits of various government schemes. Awareness of various schemes such as Sukanaya Yojana, Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJY), Pradhan Mantri Suraksha Bima Yojana(PMSBY) was spread. At the end of the session, it was informed that those who were interested in availing these facilities should come forward with the necessary documents. More 2/3 of the audience came forward to enroll in these services as well as linked their accounts to various government schemes.
Hrushikesh Sahu, an employee of Mahashakti Foundation, who is coordinating with the project Once I had returned from the session another thought arose in my mind pertaining to how could financial literacy lead to women empowerment which was the very objective of the program. I spoke with Hrushikesh Sahu, an employee of Mahashakti Foundation, who is coordinating with the project about this. His answer was that making them financially literate is the first step as it would open the minds of the females to wider perspectives. As he explained, "The next step involves assessing the capabilities of different individuals and providing them training to make them gainfully employed and raise their livelihood. They are grouped together according to similar interests, location and provided training pertaining to book-keeping, income generation, and Self Help Group management. Moreover, they are provided financial aid in the form of enterprise loans to start as well as expand their micro-enterprises".
With the digitization drive undertaken by the government, it has become possible for banks to provide services at the doorstep of the people. Herein, lies the way forward. Financial literacy can be used in creating awareness about the various programs and financial services meant for their benefits, empowerment can be brought about. It can help in increasing their opportunities in terms of income and employment by enabling them to actively participate and derive benefits from the economic growth of the country. After all, it is with the use of these digital services that organizations such as Milaap are able to reach out to more and more people located in remote areas of the country and impact their lives.
