12101 - Gates report praises Aadhaar, Jan Dhan scheme - Indian Express

Gates report praises Aadhaar, Jan Dhan scheme

The praise comes in the backdrop of continuing privacy concerns in India about Aadhaar. It also comes when there is growing distrust in the government on foreign agencies working in the development sector.

Written by Abantika Ghosh | New York | Updated: September 21, 2017 4:41 am

A development report released by the Bill and Melinda Gates Foundation has praised Aadhaar and the Indian government’s efforts at financial inclusion through schemes such as the Jan Dhan Yojana.

This is the first “Goalkeepers: The Stories Behind the Data” 2017 report that will be published every year till 2030 — the deadline for the sustainable development goals (SDGs) — in a bid to diagnose urgent problems and identify key development solutions.

“India has been especially innovative about investing in the building blocks of digital financial inclusion. Aadhaar, a nationwide biometric identification system, makes it simpler and more secure for poor people to do business. India’s regulators have implemented new rules that give financial institutions greater flexibility to provide a wider variety of services…. A new class of banks called payment banks has brought in new private sector players to the market and opened millions of new accounts. 

In 2014, the government launched a programme called PMJDY (Pradhan Mantri Jan Dhan Yojana) to help the poor open accounts in huge numbers and it recently started providing benefits to them through these accounts,” the report says.

The praise comes in the backdrop of continuing privacy concerns in India about Aadhaar. It also comes when there is growing distrust in the government on foreign agencies working in the development sector and the home ministry’s crackdown on violators of the Foreign Contributions (Regulations) Act.

The Goalkeepers report quotes Rohini Pande, the Mohammed Kamal Professor of Public Policy, Harvard Kennedy School, “Digital has changed the nature of banking and made it cheaper to reach the rural poor,” the report says.

The writer is in New York at the invitation of the Bill and Melinda Gates Foundation

12092 - Modi govt rewards 'lucky Indians' with Rs 200 crore Jan Dhan account winners have received Rs 1,100 on an average - Business Standard

Modi govt rewards 'lucky Indians' with Rs 200 crore

Jan Dhan account winners have received Rs 1,100 on an average\

Sai Manish |  New Delhi 

Last Updated at September 19, 2017 15:58 IST

The Modi administration in a bid to incentivise the use of digital transactions has doled out Rs 200 crore as cash rewards, government statistics show. The biggest beneficiaries of the government’s largesse have been RuPay debit card holders. These debit cards were issued to 220 million people while opening their bank accounts under the Jan Dhan programme for getting India’s unbanked population into the formal banking sector.

Government statistics show that almost 1.6 million people were rewarded with cash – varying from Rs 1,000 to Rs 1 crore. Out of these, 1.38 million winners – or 87% of them - were RuPay debit card holders. On an average, the Modi government seems to have rewarded these RuPay debit card users holding a Jan Dhan account with almost Rs 1,100 each.

These rewards were given as part of the government’s ‘Lucky Grahak’ (lucky customer) scheme introduced post-demonetisation to accelerate the adoption of digital payment technologies. While Jan Dhan account holders seem to have been the biggest beneficiaries of the government’s cash rewards, others also got a share of the pie.

The second biggest beneficiaries of the government’s largesse were around 150,000 people who transacted through Aadhar Enabled Payment Systems (AEPS). Around 50,000 people who used Unified Payment Interface (UPI) and a few thousand people who transacted through Unstructured Supplementary Service Data (USSD) platforms were also rewarded with cash.

These cash rewards are in line with NITI Aayog’s action plan to incentivise people in a bid to wean them away from hoarding cash. The government’s think-tank had been especially keen on pushing RuPay debit cards and AEPS systems in various spheres. It had suggested setting up a fund to incentivise banks to setup infrastructure capable of handling AEPS and RuPay debit cards in rural and semi-urban areas. The NITI Aayog in its interim report on digital transactions earlier this year had noted, “In order to minimize the need for cash during the ensuing kharif season (March-April 2017), all the 150,000 fertiliser dealers and other input dealers should be ready to accept RuPay cards and Aadhaar biometric authentication based cashless payments from farmers for purchase of fertilizers and other inputs.” It had also suggested making all transactions at ration shops cashless through use of RuPay cards and Aadhar based payments by June 2017.

But have these cash rewards by the government managed to achieve what they sought out to in the first place? By the look of it, these cash rewards do not seem to have encouraged people to swipe their RuPay debit cards more. Infact ever since the government announced these cash rewards at the beginning of the year, there has been a gradual decline in the value of RuPay debit card transactions. Information available with the National Payments Corporation of India (NPCI) shows that RuPay card transactions have fallen by a third between January and April this year. The number of times people swiped these cards at machines have also fallen gradually. On the positive side, the Modi government can take heart from the fact that demonetisation has pushed more people into using RuPay cards and other payment systems more than ever. The value of RuPay transactions in April this year was almost equivalent to what people transacted in the whole of 2015-16.

There are also serious doubts about the actual inclusivity of the government’s Jan Dhan scheme that sought to give every unbanked Indian a bank account. A report released by Grameen Foundation in collaboration with JP Morgan earlier this month doesn’t paint a promising picture of the effectiveness of the Modi government’s financial inclusion scheme. The report surveyed over 25,000 low income and below poverty line individuals in Uttar Pradesh and Delhi. Uttar Pradesh, India’s most populous state saw the maximum number of bank accounts opened under the Jan Dhan programme. The report found that almost half the number of surveyed people in rural areas and a third of the people in urban areas still did not have a bank account. Among those who had a bank account, usage was negligible. The report notes, “Over a third (35%) of bank accounts held in the sample had witnessed no transaction in the past three months and over a fifth (21%) had witnessed no transactions over the past six months. These figures were surprisingly more pronounced in the urban part of the sample, Delhi/NCR region, where over 40% of accounts were not in use for over 3 months.”

While quite visibly, the Indian government hasn’t been successful in using cash rewards to make people keep swiping their RuPay cards or use their bank accounts to transact more, nations across the world have been experimenting with using cash rewards to induce behavioral changes among citizens.

Japan, for instance, enacted the Kodomo Teate Law in 2010 to stem the fall of its population. The law enacted by the then Yukio Hatayama government gave 13,000 Yen (almost Rs 7,500) every month to every parent with a child till the age of 15. Although there is been a marginal improvement in Japan’s birth rate since the time the law was enacted, for the first time in Japan’s history, the number of babies born will be fall below a million in 2017. Singapore too amended its Child Co-Development Savings Scheme in 2001 under which anyone having more than two children could get a maximum of S$8,000 (almost Rs 3.8 lakh). However, Singapore’s birth rate has been in freefall ever since the scheme was introduced. Earlier this year, China introduced a cash incentive for citizens to catch foreign spies on Chinese soil. The Beijing National Security Bureau offered 500,000 Yuan (almost Rs 50 lakh) to any Chinese who managed to net a foreigner spying on China. It is unclear whether anyone has been rewarded for spy-busting by the Chinese government so far.

While Modi may not want to throw a gauntlet at India’s avowed fiscal discipline targets through huge unproductive cash rewards, the coming few months could well reveal whether the ‘lucky Indian’ was rewarded enough to be weaned off his love for cash. 

___________

11788 - Jan Dhan scheme: Going strong 3 years on - Hindu Businessline

Jan Dhan scheme: Going strong 3 years on

G NAGA SRIDHAR

• Aiming high The biggest financial-inclusion drive in the world is on the right track PTI 
• AJAJ SHAIKH
  

With 30 crore customers and ₹65,000-cr balance, the accounts are gaining traction

HYDERABAD, AUGUST 14:  

Three years after the launch of the world’s biggest financial-inclusion programme, the Pradhan Mantri Jan Dhan Yojana appears to have stabilised, with 30 crore beneficiaries and transactions picking up.

The scheme was launched on August 15, 2014 with a target to provide universal access to banking facilities.

The total balance in these accounts stood at ₹65,697 crore as on August 9. The rural tilt of the scheme comes across in the fact that 17.61 crore beneficiaries, out of a total of 29.48 crore account-holders, hail from rural and semi-urban branches.

The National Payments Corporation of India (NPCI) has so far issued 22.70 crore RuPay cards to account-holders.

Banks are seeing increasing traction in these accounts. “We thought the spurt in Jan Dhan accounts was driven by demonetisation, and there are allegations that some of them were used to launder black money. Investigations are on, but the maintenance of stable balances in these accounts may disprove this argument,” said a senior executive of SBI.

“Regular and healthy” transactions are being reported across banks, he added.

Just one day after the announcement of demonetisation on November 8, 2016, the cumulative balance in about in about 25 crore accounts was about ₹45,600 crore. But post-demonetisation, that figure has gone up.

While the final word is yet to be said on the alleged channelling of black money into Jan Dhan accounts, the scheme has indeed led to a transformation.

According to the NPCI, which handles the RuPay cards being given to Jan Dhan customers, out of 385 million RuPay cards, 225 million are of Jan Dhan accounts.

“In the past three years, domestic card usage has taken off, thanks to Jan Dhan,” says AP Hota, who recently demitted office as MD and CEO of the NPCI, and who played a key role in the implementation of the scheme.

A bulk of the RuPay card transactions are through ATMs, while about 25-30 million customers have started transacting via point of sale (PoS) terminals, signifying the advent of e-commerce and digital transactions in rural India.

Now that the financial inclusion in the sense of universal bank accounts has been driven by Jan Dhan along with Aadhaar seeding, it will have to go on to offer a basket of financial products such as credit and insurance, which are yet to take off in a big way.

(This article was published on August 14, 2017)

11464 - Aadhaar, Jan Dhan led to India's improved economy in 3 years: PM in Gujarat - Business Standard

Aadhaar, Jan Dhan led to India's improved economy in 3 years: PM in Gujarat

Said two factors behind India's growth are universal banking and universal biometric identification

IANS  |  Gandhinagar 

May 23, 2017 Last Updated at 13:12 IST

Gujarat Chief Minister Vijay Rupani and Deputy Chief Minister Nitin Patel welcomes Prime Minister Narendra Modi at airport in Bhuj, Gujarat

Fuelled by Aadhaar and Jan Dhan Yojana, India has improved upon all the macroeconomic indicators over the last three years, Prime Minister Narendra Modi said in Gandhinagar on Tuesday.

"The fiscal deficit, balance of payments deficit and inflation have all come down while the GDP growth rate, foreign exchange reserves and public capital investments have increased," Modi said while inaugurating the 52nd annual meeting of the African Development Bank.

The prime minister said India had taken huge strides in development and could share with Africa some of the strategies used by his government over the last three years.

He said two crucial factors behind India's growth story were universal banking and universal biometric identification.

"The first set of changes we made was in the banking system. We launched Jan Dhan Yojana under which over 280 million bank accounts have been opened for the poor in rural and urban areas," he said

"Thanks to the initiative, virtually every Indian family has a bank account," he added.

The second crucial element was the universal biometric identification system called Aadhar, Modi said.

"It prevents claiming of benefits by those who are not eligible. It enables us to ensure that those who deserve government aid receive it by easy while eliminating non-genuine claims," he said.

Modi said by paying subsidies directly to the poor rather than indirectly through price concessions, India achieved large fiscal savings.

He said India and Africa had a long history of cooperation with strong ties lasting for centuries.

"India's partnership with Africa is based on a model of cooperation which is responsive to the needs of African countries," he said

"After assuming office in 2014, I have made Africa a top priority for India's foreign and economic policy," the prime minister said.

He said while he himself visited six African countries ever since becoming the Prime Minister, there was no country in Africa that has not been visited by an Indian minister in the last three years.

He said that Africa-India trade had multiplied in the last 15 years with it doubling in just the last five years to reach nearly 72 billion dollars in 2014-15.

"From 1996 to 2016, Africa accounted for nearly one-fifth of Indian overseas direct investments."

The Prime Minister said most of the challenges facing both India and Africa were the same including uplifting farmers and poor, and empowering women.

"Our challenges also include ensuring our rural communities have access to finance and building infrastructure within financial constraints and maintaining macroeconomic stability so that inflation is contained," he said.

Modi added while India cannot compete with Africa in long-distance running in sports arena, "but I can assure you that India will always stand with you shoulder to shoulder supporting you in the long and difficult race for a better future".

• READ MORE ON
• MODI IN GUJARAT

10728 - Demonetisation a catalyst for a cashless society - Live Mint

Demonetisation a catalyst for a cashless society

It is pleasing to see smaller merchants such as tea stalls, grocery stores as well as consumers in rural and smaller cities embracing digital payments

Arvind Gupta

Photo: Abhijit Bhatlekar/Mint

The Modi government’s demonetisation decision, replacing 86% of currency, was undeniably disruptive. No major disruptive decision comes without upheavals and it will be foolhardy to suggest that the removal of Rs500 and Rs1,000 notes from circulation hasn’t inconvenienced most people, especially those on the wrong side of the socioeconomic and digital divide in India—the poor. Yet, the exercise was neither a knee-jerk reaction nor was it without consideration for the poor. In fact, it was just the opposite and reflective of the inclusive motto of the Prime Minister and his government’s ‘sabka saath sabka vikas’ theme.

Removing high-denomination currency notes fits well with the government’s successful efforts at financial inclusion, through Jan Dhan, and using technology as an enabler, through Digital India, to improve the socioeconomic condition of the most marginalized sections in our society. The central idea behind this vision is not just about connectivity, but about how to leverage that connectivity in enabling consumers, small businesses, traders and farmers to harness technology for efficiency and productivity.

The Jan Dhan-Aadhaar-Mobile trinity and less-cash initiatives are the backbone of far-reaching reforms, development and a growth agenda. Each and every Indian can now have access to full financial services through the revolutionary IndiaStack. 

IndiaStack is open innovation at its best, with tight integration with Aadhaar identity, digital locker and payment systems available to all to build their innovations on top of these platforms. The data exhaust from the digitization efforts will make our society truly data rich, which in turn can be leveraged for a host of applications, including better credit facilities for small and medium businesses, customized insurance and savings products, among others.

Prior to demonetisation, the bulk of transactions were conducted through cash. Since then, it has reduced considerably and this move has proven to be a catalyst for consumption to be digitally driven and payments to go cashless. However, it must be acknowledged that large parts of the poorer sections of society, especially in tier-2 and 3 cities as well as in rural India, are not financially literate and distrustful of the formal banking system. In many cases, even if they have bank accounts, they are unaware and unable to use digital payments systems. That is the real challenge for the new-age banks and fintech disruptors. They need to ensure that a consumer trusts and uses digital payments as comfortably as cash.

It is pleasing to see, since the demonetisation drive, the number of smaller merchants such as tea stalls, grocery stores as well as consumers in rural and smaller cities embracing digital payments through mobile wallets, bank point-of-sale machines, among others. But in order to make digital payments pervasive and sustainable, India not only needs to focus on continuing to roll out digital infrastructure, but also proactively educate its citizens on the long-term benefits of digital transactions.

The payment supply chain should work on smartphones, as well as on feature phones in areas of low connectivity with confidence. There are already villages in states such as Gujarat and Haryana where digital payments are the norm, be it in grocery shops or managing welfare payments from the government. But this needs to be replicated around the country.

The digital transformation of cash is also a cost savings to the entire financial ecosystem and not just the public purse. From printing to cash management to physical infrastructure to securing and dispensing of currency, cash is very expensive. Banks and our government must think out of the box to pass these savings to consumers as incentives to embrace digital transactions.

India must use the demonetisation drive to harness its innovation and political capital, to ensure those who are on the wrong side of the digital and socioeconomic divide, especially in rural Bharat, can effectively function in a less-cash society.

So, while it has thrown up many challenges, this bold decision by the government definitely acts as a catalyst to ensure all parts of our society can be part of India’s growth story. The government cannot do it alone—all of us need to play our part in it.

Arvind Gupta is a digital innovator and Eisenhower Global Fellow, currently heading the BJP’s information & technology department. The views expressed here are personal.

His Twitter handle is @buzzindelhi

Arvind Gupta

10658 - Withdrawal limits imposed on Jan Dhan accounts - Live Mint

Last Modified: Wed, Nov 30 2016. 09 00 PM IST

Withdrawal limits imposed on Jan Dhan accounts

Temporary limits on cash withdrawal from Jan Dhan accounts have been imposed to prevent benami property transaction and money laundering, says RBI

Viswanath Nair

According to limits set by the RBI, customers can withdraw up to Rs24,000 every week from their bank accounts using instruments such as cheques and demand drafts. 

Photo: Aniruddha Chowdhury/Mint

Mumbai: The Reserve Bank of India (RBI) on Wednesday announced that it will place stringent withdrawal limits on bank accounts under the Prime Minister’s Jan Dhan Yojana (PMJDY) as a “temporary” precautionary measure.

In a notification on its website, the regulator stated that this was done to protect innocent farmers and rural account holders of PMJDY from activities of money laundering and legal consequences under the benami property transaction and money laundering laws.

The central bank said that on accounts which are fully compliant of the know your customer (KYC) norms—the monthly withdrawal limit has been set at Rs10,000. 

“The branch managers may allow further withdrawals beyond Rs10,000 within the current applicable limits only after ascertaining the genuineness of such withdrawals and duly documenting the same on bank’s record,” RBI said in its notification.

According to limits set by the central bank, customers can withdraw up to Rs24,000 every week from their bank accounts using instruments such as cheques and demand drafts. 

Farmers have a slightly higher withdrawal limit of Rs25,000 per week. The limits on Jan Dhan accounts are over and above these restrictions.

In cases where accounts are not KYC compliant too, account holders will be allowed a monthly withdrawal of Rs5,000 on deposits made in old Rs500 and Rs1,000 banknotes, within an overall limit of Rs10,000 per month. 

The regulator clarified in its notifications that this would be applicable on PMJDY accounts where old Rs500 and Rs1,000 notes have been deposited since 9 November. Prime Minister Narendra Modi, on 8 November, had announced that Rs500 and Rs1,000 notes will be stripped of legal tender status.

As on 23 November, Indian banks had opened 256.8 million accounts under the Jan Dhan scheme, where 138.5 million accounts were linked to Aadhaar, according to data available with the PMJDY website.

As on 23 November, Indian banks had opened 256.8 million accounts under the Jan Dhan scheme, where 138.5 million accounts were linked to Aadhaar, according to data available with the PMJDY website.

vishwanath nair

10621 - Demonetisation hits Chenchus hard - The Hindu

Demonetisation hits Chenchus hard

S. Murali

ONGOLE: NOVEMBER 19, 2016 00:00 IST

Many of them don’t have ‘zero balance’ accounts under Jan Dhan Yojana

Withdrawal of high-value notes by the Central government has shocked not only urbanites but also Chenchus, a Particularly Vulnerable Tribal Group, in Prakasam district.

A majority of people in the tribal habitations of Koraprollu, Nallaguntla, Chilakacherla, Cheruvugudem and Bandambavi in Dornala mandal are without ‘zero balance’ savings bank account introduced under the Prime Miniser’s pet Jan Dhan Yojana. “We have been running from pillar to post for opening bank accounts without any positive outcome,” says Dasari Chinna Kotaiah. Hundreds of tribal people will be unavailable at home during day time as they have to go to work, he says. They have to walk for about 20 km to reach the nearest bank (Andhra Bank) and cannot skip work frequently. The tribal people are clueless on exchanging the scrapped notes as the bankers insist on depositing Rs. 500 for a normal savings bank account, which they can ill-afford, says Dasari Kesamma.

Many of them are also without the Aadhaar card, an important Know Your Customer (KYC) document mandatory for opening a bank account.

“We have missed when enrolment for Aadhaar card was on in the village last year,” says Kudumala Dargamma, who saved a few Rs. 500 notes to meet any health or other emergencies.

Experts in cutting bamboo in the forests, Chenchus are engaged to work in farms and cut subabul and eucalyptus trees in this drought-prone district. They earn, on an average, Rs.150 per day.

“With dwindling forest produce, we are forced to go to work in the plains,” adds Kudumala Bayanna, another tribal person. Chenchus with a bank account too have a grouse. Their accounts have become dormant as they are not used to carry out any transaction on a regular basis. Those whose accounts are active also have a complaint.

“We are provided with Rs. 2,000 note, which we are unable to exchange in any of the shops,” they say. Those with less amounts in their account are unable to draw any cash. Though some of them worked under the MGNREGS, their accounts were not credited with wages despite a lapse of two months as they turned inactive.

10514 - Direct benefit transfers will become the norm: Arun Jaitley - Live Mint

Last Modified: Mon, Oct 03 2016. 01 39 AM IST

Direct benefit transfers will become the norm: Arun Jaitley

If anyone wants benefit of public revenue through subsidies or any other form, the authorities can insist on production of the unique identity, says Arun Jaitley

Komal Gupta / Suranjana Roy

A file photo of finance minister Arun Jaitley. Photo: Mint

New Delhi: Finance minister Arun Jaitley on Saturday emphasized the importance of Aadhaar for cashless transactions and government schemes at a conference on digital payments.

“Eighty percent of people have mobiles in the country; we have crossed the one billion mark. Aadhaar card enrolment has reached close to 95% mark as far as adult population is concerned,” Jaitley said at the ‘Digital Payments: Inclusion, Growth and Opportunities’ meet.

The meet was organized by the Observer Research Foundation, a global think tank, in association with the Better Than Cash Alliance, a tie-up of governments and organizations that seeks to accelerate the transition from cash to digital payments to drive inclusive growth.

Direct benefit transfers, where subsidies and other benefits are directly paid to the benefiary’s bank account, will be the rule, Jaitley said.

“If anyone wants benefit of public revenue through subsidies or any other form, the authorities can insist on production of the unique identity,” added Jaitley.

Aadhaar will help rationalize, target and implement subsidies better.

The Pradhan Mantri Jan Dhan Yojana was an exemplary programme with nearly 240 million people being enrolled within weeks, Jaitley said.

“No Indian can really today say that he didn’t have the facility of a bank account,” he added.

The Digital India initiative, along with the JAM, or Jan Dhan-Aadhaar-Mobile, Trinity, and Less-Cash India, are examples of such inclusive growth efforts.

Jaitley on 6 July released the ‘less cash campaign road map” of the Confederation of All India Traders (CAIT), which has launched a nationwide campaign to promote the usage of digital payments .

With over a billion a mobile connections, a quarter of a billion bank accounts (Jan Dhan) and a digital identity database (Aadhaar) of a billion, the aim is now to give a strong push to the digital future of the country.

Niti Aayog chief executive officer Amitabh Kant shared similar views in his speech during one of the sessions.

“Nothing is going to transform India other than the spread of Internet, in a rapid and fast manner. The habit of using cash has to do away,” he said.

With the help of four game changers namely Digital India, Unified Payment Interface (UPI), JAM and the expansion of Point of sale (PoS) terminals, India should move towards a completely digitized payments by 2025, Kant said.

“We have around 1.2 million PoS terminals in India. We need to take it to around 20 million in the next two years,” Kant added.

A lot of innovations in the payments landscape have happened such as doing away with Know Your Customer (KYC) requirements for transactions up to Rs10,000, exemptions of wallets from two-factor authentication and use of regional languages in payment gateways. ‘The right of way’ policy which will be finalized by the government soon is expected to be another game changer.

However, digital payments still constitute just 22% of all consumer payments. The aim should be to scale this Rs50 billion industry to Rs500 billion by the end of 2020.

Komal GuptaSuranjana Roy

10471 - Understanding India’s push into biometrics By: Chris Wright - Euro Money

Understanding India’s push into biometrics By: Chris Wright Published on: September 2016 From Aadhaar to iSPIRT – your guide to Indian biometrics. Print Order   • 

Aadhaar is a biometric ID card, but it is significant to financial services as a method of authentication. Using the card and a fingerprint or iris scan, it becomes possible to identify oneself accurately from anywhere, and without the need for a paper trail. A feature of Aadhaar called eKYC (electronic know-your-customer) allows a cardholder to open a bank account instantly, just using their Aadhaar number and their own biometrics. Subsequent initiatives linked to Aadhaar include a digital signature to make documents secure; and a digital locker to store those documents. • Prime minister Narendra Modi was elected on a platform of inclusion, and on Indian Independence Day in 2014, from New Delhi’s Red Fort, he introduced a keystone initiative to ensure that every family living in India has a bank account. This is known as Jan Dhan Yojana (in full, Pradhan Mantri Jan Dhan Yojana, or 'prime minister’s people money scheme’). Many open with a zero balance, but the idea is that it connects the disenfranchised to the economy. Also, it’s free, and comes with life cover. By June 2016, 220 million accounts had been opened, including 18 million in the first week in August 2014, which apparently got it into the Guinness World Records. • One of the benefits that comes with a Jan Dhan Yojana account is the RuPay debit card, usable at ATMs, point-of-sale machines and e-commerce sites at cheaper rates than Visa and MasterCard. By May 2016, 267 million debit cards had been issued. "It was conceived to fulfil RBI’s vision to offer a domestic, open-loop, multilateral system, which will allow all Indian banks and financial institutions in India to participate in electronic payments," says Puneet Gulati at JM Financial. Axis Capital calculates that RuPay has already built a 38% market share after four years of operations. A RuPay credit card will follow later this year. • RuPay is one of many initiatives by the National Payments Corp of India, a fascinating institution that has been a key driver of banking technology (as has the Reserve Bank of India, which has encouraged it throughout). NPCI was set up in 2009 by the RBI and the Indian Banks Association, and is a non-profit organization owned and promoted collectively by 10 of the biggest banks in India, from public State Bank of India to private sector ICICI and HDFC, and foreigners Citibank and HSBC. It is an umbrella organization for all the retail payments systems in India. "It is creating infrastructure which rests on the principle of large scale and high volumes, resulting in payment services at a fraction of the present cost structure," explains Priya Rohira, executive director at Axis Capital. The various products that have come out of NPCI have gone from handling 2 million transactions a day six years ago to about 22 million a day now, with an aim of reaching 100 million a day.  • Aside from RuPay, two key NPCI initiatives are the Aadhaar Payments Bridge System and Aadhaar Enabled Payments System, and this is where the interconnections between the various initiatives in India start to get interesting. Through these, the payment of government benefits, such as subsidies for natural gas, are handled automatically and paid into an account verified through the Aadhaar card. More than 1 billion transactions have been completed using the payments bridge so far, and 260 million bank accounts are directly linked to Aadhaar. This is the clearest illustration of what the government is trying to do: the Aadhaar ID has facilitated the opening of a bank account; the automatic payment of government benefits into it has made that bank account active; and suddenly that person is part of the financial mainstream, with the added benefit that wastage, corruption and fraud are removed from the system. • Another NPCI success is the Immediate Payment Service, or IMPS, which provides mobile-based fund transfer. The smartphone is going to be instrumental to India’s financial journey, perhaps even more so than elsewhere; through it, Credit Suisse analyst Ashish Gupta argues that India is going to skip two generations in banking, largely going straight from branch banking to mobile banking. Gupta also expects virtually all bank deposit holders to own a smartphone by 2020. IMPS has been a huge success: transactions through it grew by 180% year on year in fiscal 2016, with Rs1.62 trillion ($24 billion) transacted through the system in a single year.  • However, the newest initiative, the Unified Payments Interface, launched on July 31, goes further still. IMPS is by most standards a great system, but it does have limitations: only banks that are members of NPCI’s IMPS system can access its database, meaning that mobile wallets are excluded from it; the process of transfer can be cumbersome at first; and it only allows for so-called 'push’ transactions, through which the sender initiates the transaction. What is revolutionary about UPI is inter-operability, which means money can be transacted across multiple different bank accounts, cards, wallets and banks. (At least 15 banks are believed to have rolled it out on July 31, with others following.) Mobile numbers can be used to identify recipients. And where IMPS can only push, UPI can pull, too, where the recipient initiates the transfer – for example, a merchant’s billing system initiating a payment. "It’s the world’s first inter-operable mobile payments system," says Nandan Nilekani, cofounder of Infosys. "Pushing or pulling money from a smartphone will be as easy as sending or receiving an email."  • Next comes the Bahrat Bill Payment Service (BBPS), which is aimed specifically at regular bill payments. Credit Suisse reckons $115 billion of bills are processed in India each year, and paper-based payments constitute over 90% of those payments. BBPS will be an inter-operable system, operating as a single authority through which customers can pay all their bills electronically. • This whole combination of elements is known generically as India Stack, a term coined by the think-tank iSPIRT. You might think of it as a pyramid, with Aadhaar as the foundation, and various other layers built on top of it, culminating with UPI, all of it assisted by the growing use of the mobile phone. Jan Dhan means everyone will have a bank account; Aadhaar means everyone has a unique identity for verification; mobile connectivity means anyone can access it all from anywhere. • One other important point to understand, particularly from a banking perspective, is that all of this means that India moves from being data poor to data rich. "A large majority of Indians are today invisible to formal lenders due to them being thin-file or no-file customers from the point of view of lenders," says Credit Suisse’s Gupta. "The result is low credit penetration and, in particular, low unsecured credit." But one result of all these digital initiatives is that "more of modern life gets captured in digital data streams", says Gupta. • Consequently there is, perhaps, one layer left to build: Nilekani calls it the Electronic Consent Architecture. "There’s all this data that is going to start spewing out of every system, this digital footprint," he says. "Is there a way to make it simple for an individual or business to leverage his own data for his own benefit? If I want a loan, and I can show through this data that I have a consistent record of payment, then it’s more likely I will get a loan." He is talking with the Reserve Bank to see if this can be accessible to the financial sector as a standard way of assessing applicants. "And that," he says, "hopefully, will be the last step."

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10439 - Poor account - Indian Express

Poor account

Problem lies not with Jan Dhan, but the way the scheme is being pushed.

It is unfortunate to see bank officials in many parts of the country making one-rupee deposits in Jan-Dhan accounts simply with a view to hide their “zero-balance” status, as an investigation by this newspaper has revealed. The fact of the matter is that the opening of over 24 crore bank accounts, of which some 19 crore have been issued RuPay debit cards and over 50 per cent seeded with the unique Aadhaar identity number of the account-holders, is no mean achievement. That it has happened within a span of two years or so makes it all the more remarkable for a country, where nearly 40 per cent of the population till recently had no access to formal banking. The Pradhan Mantri Jan Dhan Yojana (PMJDY), moreover, aims to go further than just ensuring financial inclusion. It seeks to move to a system of making payments under various government programmes through direct transfers. Alongside reducing leakages in subsidies and other welfare expenditures, the goal is also to migrate to a cashless economy whose knock-on impact on growth cannot be underestimated.By: Editorial | Updated: September 14, 2016 12:31 am

That is precisely also the reason why the attempts at dressing up data is all the more deplorable. It is not clear whether the pressure for this has come from the top or simply acts by over-enthusiastic branch level officials. Either way, they violate basic banking principles — which rest on integrity, trust and transparency. The Indian Express investigation has shown that the account-holders were not even told about the Re one deposits when they were made. It obviously opens up the possibility of one’s account being similarly used to deposit slush funds without that person’s knowledge — and being withdrawn as well. An investigation is due and the officials involved are punished. At the end of day, there is nothing to be ashamed about zero-balance accounts. Financial inclusion is a necessary but not sufficient condition for money to be in accounts. The latter requires generation of jobs and incomes. Zero-balance accounts are a good indicator of that not happening. As a wise central banker once said, finance can facilitate but not lead.

There are critics of PMJDY who say the scheme should not have been implemented through fiat. The counter to that is if there was no push, banks would never have facilitated the opening of these accounts. Financial inclusion is an investment the returns from which are far higher than the ostensible costs imposed on the banking system. In this case, the problem lies not with the scheme, but in the spin doctors.

10433 - Jan Dhan Yojana empowers, that’s why the red flag - Indian Express

Jan Dhan Yojana empowers, that’s why the red flag

Budget for it, make it official, advises former Expenditure Secy; Justice B N Srikrishna warns of account misuse.

More than 50 per cent of the Jan Dhan accounts have been seeded with the Aadhaar of the account holder.

In terms of scope and size, and the breadth of coverage, the Pradhan Mantri Jan Dhan Yojana is a stand-out scheme perhaps among all financial inclusion initiatives underway in other parts of the world.

With 24.1 crore bank accounts having been opened till August 31, 2016, and with an accumulated balance of  Rs 42,094.24 crore, according to official records, it could be the transformative agent that the Prime Minister has so soften talked about. By bringing all households into banking, it will provide access to other financial services such as insurance and pension besides credit, help reduce leakages in subsidy payments, promote the larger goal of encouraging electronic payments and progressively reduce the use of cash.

More than 50 per cent of the Jan Dhan accounts have been seeded with the Aadhaar of the account holder and thus, these accounts are eligible for all wage payments to NREGA workers through Direct Benefit Transfer and also for direct subsidy payments related to LPG.

An estimated 19 crore of these accounts have been issued Rupay cards and they can be used like any other debit card to withdraw money from ATMs.

All the more reason why efforts to ramp up numbers of non-zero balance accounts raises several concerns about ethics, breach of trust, accuracy of data and, more worryingly, the potential for misuse.

Banks in India have a code of customer rights — developed by Banking Codes and Standards Board of India — to ensure protection of customers, promote fair banking practices, and foster confidence in the banking system. Officials themselves putting money — even if it’s merely a rupee — into Jan Dhan accounts without the customer’s knowledge to boost numbers of non-zero-balance accounts violates the code. To establish this as a mala fide may be difficult given that banks have said that there aren’t any written instructions.

Read | The One-Rupee Trick: How banks cut their zero-balance Jan Dhan accounts

Justice B N Srikrishna, former Supreme Court judge who headed the Financial Sector Legislative Reforms Commission or FSLRC, which submitted a host of recommendations for a new financial architecture, isn’t certain about the legal bar on transferring or depositing funds into a bank account without the express approval of the account holder.

But what is of greater concern, he says, is the potential for misuse of such accounts. “Someone could deposit money into your account and later anyone can say this was bribe funds. Using the account of someone who is not aware of basic banking is a good way to convert black money,” he says.

List of Jan Dhan accounts from six states

For the more savvy or financially literate customer, this may not be an issue given constant alerts for each transaction. But that’s not the case for those with recent access to basic banking services.

Former Expenditure Secretary D Swarup says that a cost-benefit analysis should be done to ensure that these schemes are successful and effective. In other words, if a one-rupee payment needs to be made to reduce zero-balance accounts for whatever reason, says Swarup, a budgetary provision for implementing this and compensating banks for providing such services would be a much more transparent way of doing it.

Also, this would not put pressure on banks and ensure accountability.

Breach of trust isn’t the only issue.

Inflated numbers also portray an inaccurate picture of the success of a scheme and this can lead to faulty policy interventions, more funds being poured in without any effective monitoring or assessment post implementation. This could also prevent corrective measures mid-course and a more robust rollout of social sector programmes.

10410 - The way ahead on Aadhaar By ANUPAM SARAPH - Sunday Guardian

The way ahead on Aadhaar

By ANUPAM SARAPH | 10 September, 2016

A man goes through the verifications to get his Aadhaar card at an Aadhaar enrolment centre. ians

PM Modi is the right leader to take firm steps to protect national interests from the private interests that are seeking to take over governance through the functional creep of the Aadhaar as it is at present.

REQUIREMENTS OF LAW

On 23 September 2013, the Supreme Court of India made it very clear that “no person should suffer for not getting the Aadhaar card, in spite of the fact that some authority had issued a circular making it mandatory”. It is unlikely that it could be more clearly expressed that the Aadhaar was not to be forced upon citizens. The court also required that “when any person applies to get the Aadhaar Card voluntarily, it may be checked whether that person is entitled for it under the law and it should not be given to any illegal immigrant”.

The contempt petitions filed before the Supreme Court are testimony to the bureaucratic disregard for the orders of the Supreme Court. On 16 March 2015, the Supreme Court stated, “It is brought to our notice that in certain quarters, Aadhaar identification is being insisted upon by the various authorities, we do not propose to go into the specific instances. Since Union of India is represented by learned Solicitor General and all the States are represented through their respective counsel, we expect that both the Union of India and States and all their functionaries should adhere to the Order passed by this Court on 23rd September, 2013.”

In its order of 11 August 2015, the Supreme Court documented assurances by the Attorney General of India that Aadhaar would not be used for any purpose other than social benefit schemes.

It ordered that the Union of India shall give wide publicity in the electronic and print media, including radio and television networks, that it is not mandatory for a citizen to obtain an Aadhaar card. It further directed that the production of an Aadhaar card will not be condition for obtaining any benefits otherwise due to a citizen. It also emphasised that the Unique Identification Number or the Aadhaar card will not be used for any purpose other than the PDS scheme and in particular for the purpose of distribution of food grains, etc., and cooking fuel, such as kerosene and LPG. It emphasised that the information about an individual obtained by the Unique Identification Authority of India, while issuing an Aadhaar card, shall not be used for any other purpose, save as above, except as may be directed by a court for the purpose of criminal investigation.

In a modification of the order of the 11 August 2015, in October the Supreme Court permitted the use of Aadhaar for Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), National Social Assistance Programme (Old Age Pensions, Widow Pensions, Disability Pensions) Prime Minister’s Jan Dhan Yojana (PMJDY) and Employees’ Provident Fund Organisation (EPFO), however impressing upon the Union of India that “it shall strictly follow all the earlier orders passed by this Court commencing from 23.09.2013”. It also made it clear that “the Aadhaar card Scheme is purely voluntary and it cannot be made mandatory till the matter is finally decided by this Court one way or the other”.

GOOD GOVERNANCE, RULE OF LAW

The additional contempt cases and the recent compilation by the Software Freedom Law Centre (SFLC) on media reports of violations of the court’s orders show that change is needed and that only the PM can effect this. The mushrooming of private start-ups and foreign and Indian venture capital for Aadhaar based financial and technology solutions indicate the spread of the problem , not its containment. The assurances of the Attorney General, the directions to the Solicitor General and the various counsels representing various state governments have not resulted in the bureaucracy implementing the orders of the Supreme Court. There is no evidence that Aadhaar numbers issued after the 23 September 2013 were issued only to persons entitled for it under the law and not any illegal immigrant. This means the Aadhaar issued to fictitious persons, dead persons and illegal immigrants can continue to create ghost and fake Aadhaar numbers.

There is an urgent need to restore the confidence in the government of the people, for the people and by the people.

RE-ESTABLISH FAITH IN GOVERNANCE

First, the faith in the rule of law needs to be re-established. Not by pushing an Aadhaar Act as a Money Bill, but by listening to the wisdom of the Supreme Court’s consistent orders from September 2013.

The UIDAI has admitted that 99.97% of those issued with Aadhaar numbers did not really need them because they were already in possession of adequate identification documents. The inability to prove identity has not been the biggest cause for exclusion or a barrier to access benefits. The use of Aadhaar has added an additional unnecessary layer that has promoted exclusion, organised crime, identity theft, money laundering and corruption.

Conflict of interest is a situation in which a person is in a position to derive personal benefit from actions or decisions made in their official capacity. Many key persons from the UIDAI now head, advise or invest in “solutions” using Aadhaar. 

Some international organisations are known for their interest in driving Aadhaar linked programmes. Their campaign for the use of Aadhaar and its functional creep is not independent of private interest and overbearing conflict of interest.

Despite orders of the Supreme Court, the continued use of Aadhaar for “seeding” other databases, for KYC, for banking transactions, for verifying private individuals through private companies continues. There is even a rise of private investments and companies to facilitate such “solution stacks”. This is not only an effective way for selective exclusion, but reeks of a nexus between elements of the bureaucracy and private parties.

To serve any utility at all, shouldn’t Aadhaar numbers need to be verified and audited using the original application forms and identifying and verifying all individuals who filled them?

If the common intent of the government and the Supreme Court is to ensure no person suffers through exclusion due to Aadhaar or otherwise, wouldn’t it be prudent to set up an Exclusion Prevention Commission? Such a commission would ensure that not only no person is caused to suffer for not getting the Aadhaar card in spite of the fact that some authority had issued a circular making it mandatory, but also for any other reasons.The government must restore the rule of law by ensuring an Exclusion Prevention Commission that is independent of bureaucracy and Aadhaar?

Second, the purpose, utility and cost effectiveness of Aadhaar for governance must be justified. Unlike other IDs, Aadhaar cannot replace other IDs, is not even of any utility and adds to costs. The data associated with the number has never even been verified or audited. Furthermore neither the UIDAI nor its registrars, enrolment agencies or institutional users of the Aadhaar number are legally liable for fake or duplicate identities or fraud resulting as a consequence of the use of such numbers. The person whose Aadhaar may be misused is liable for all crimes committed using the number, without any recourse to risk reduction or protection against misuse. 

Surely the Supreme Court’s restriction on the use of Aadhaar to a few schemes is to ensure there are no undue fraud, unjustified liability, functional creep, purposeless use and wasteful expenditure that threaten to destroy the rights of citizens through a single number? Aren’t these the very reasons the UK scrapped its ID programme?

To serve any utility at all, shouldn’t Aadhaar numbers need to be verified and audited using the original application forms and identifying and verifying all individuals who filled them? Hasn’t Aadhaar already excluded crores of Indians in a bureaucratic scramble to show a large number of enrolments and claim benefits of finding “ghosts” and “fakes” in various databases using Aadhaar, an unverified and unaudited database created by private parties with conflict of interest? 

Aren’t the examples of exclusion and fraud from Rajasthan, Maharashtra, Karnataka, West Bengal, Kerala, Pondicherry just the tip of the iceberg ready to subvert the democratic process?

It is unclear how a number that is not an identity card is a proof of identity, address, even existence, or a replacement for existing KYC procedures or a basis to de-duplicate other databases. Wouldn’t it, therefore, be appropriate to ensure independent Audit Committees that verify and audit each ID to ensure good governance instead of creating a functional creep of Aadhaar?

The very number that promised to rid the country of corruption has actually created layers of corruption? Is it any wonder that India has moved higher in the list of corrupt nations?

Thirdly, it is necessary to restore people’s faith in PM Modi’s call for minimum government and good governance. The UIDAI fails to explain how 94.7% of the villages without a bank branch or bank literacy will be served by DBT through Aadhaar. It fails to explain why RBI’s NEFT and RTGS cannot serve the better than the Aadhaar based Payment Systems run by a private company, the NPCI. A policy of insistence on Aadhaar and DBT has created new barriers that not only exclude beneficiaries but also open up undetectable channels to siphon subsidy, launder money take bribes and park black money.

Good governance puts public and national interest above private interest. It eliminates situations of conflict of interest. As long as there is a ruling class, it is a private interest. As long as there is privatization of public functions by bureaucracy, there will be conflicts of interest. Peter’s principle ensures private interest will never result in minimum government or good governance.

To replace people’s faith in minimum government and good governance, Prime Minister Narendra Modi will need not only to eliminate the Aadhaar virus but also transform  the bureaucracy that has sought silently to put behind his governance reforms by at least a decade with an Indian Public Service allowing every Indian to serve nation building through secondment on contract to each level of the bureaucracy. After all isn’t that what he calls “Team India”?

PM Modi is the only leader with the vision and power to change the parameters of Aadhar in a way that meets his objective of good governance, empowerment of citizens and transparency.

Dr Anupam Saraph, a professor, future designer and former governance and IT adviser to former Goa Chief Minister Manohar Parrikar and the Global Agenda Councils of the World Economic Forum, can be found on Twitter at
@AnupamSaraph

10384 - SC to hear fresh plea against making Aadhaar mandatory - Live Mint

Mon, Sep 05 2016. 05 25 PM IST

SC to hear fresh plea against making Aadhaar mandatory

Mathew Thomas, the petitioner who had earlier challenged the constitutional validity of Aadhaar, has now filed the contempt plea in the apex court

Photo: Satish Kaushik/Mint

New Delhi: The Supreme Court on Monday agreed to hear a fresh contempt plea against the government for allegedly making use of Aadhaar mandatory.

On 11 August 2015, the court had spelt it out that Aadhaar cannot be made mandatory for any government schemes and subsequently restricted the use of the unique identity number to a few schemes.

The court agreed to hear the plea against the secretary, ministry of human resources development, for making use of Aadhaar mandatory for scholarship. The petition also names many other government departments.

Mathew Thomas, the petitioner who had earlier challenged the constitutional validity of Aadhaar, has now filed the contempt plea.

A case challenging Aadhaar on the grounds that it violates the right to privacy is already before the apex court. The case has been referred to a Constitution bench, which is yet to hear the case.

In an interim ruling in December, the court allowed use of Aadhaar for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), the Pradhan Mantri Jan Dhan Yojana, pension schemes of the Central and state governments and the Employees’ Provident Fund Scheme, in addition to its use in the public distribution system (PDS) and the distribution of cooking gas and kerosene subsidies.

In March, the government passed Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Bill as a money bill.

A challenge to passage of the law as a money bill is also being heard by the apex court.

10340 - Transforming India - Hindu Businessline

Transforming India

The Centre needs to stay focussed on implementing the promises made in the past

The Modi government has been accused in the past of being big on slogans, but not so big on delivery. While slogans do play an important role in conveying a message to the masses, there is a risk of rhetoric overwhelming reality. This is why Prime Minister Narendra Modi’s Independence Day speech came as a refreshing departure from the past. While Modi’s wonted oratorial skills were very much in evidence, the thrust of the speech was less about slogans and more about implementation. This focus on outcomes rather than intentions is welcome. Indeed, outcomes should be the focus of this, or any government. If at all another slogan is needed, it should be ‘Implementation, 

Implementation, Implementation’. For, this administration, more than any that preceded it, will be judged on its implementation record.

There is no denying that the National Democratic Alliance government has speeded up implementation of projects, acted on prices and on the whole taken forward the reforms process set in motion by the preceding governments. More notably, Modi has not only embraced some of the previous government’s schemes such as Aadhaar and the Mahatama Gandhi National Rural Employment Guarantee Scheme, as well as direct transfer of benefits and subsidies, but brought his wonted powers of execution to bear on them, ensuring that what had, with the exception of MNREGS, largely remained merely good ideas were transformed into actions that benefit the poor. Incidentally, some of these projects had been criticised by Modi in the run up to the May 2014 general elections. The fact that not only were these schemes not scrapped, but pursued with vigour, signals a growing maturity in our polity. Reforms are a continuous process, which need some course correction every few years, particularly with changes in economic environment and social circumstances. As the Prime Minister correctly stated in his speech from Red Fort to mark the 70th anniversary of India’s independence, all policies should aim to serve the national interest. And so, it is in the national interest for an incoming government to carry forward a previous government’s scheme after rectifying shortcomings in the scheme.

Over the past two years that it has been in office at the Centre, the NDA government has time and again demonstrated this ability to seize a good idea and implement it fully. It took diesel price deregulation, that had begun during the UPA’s term, to its logical conclusion. Further, the learnings from diesel price deregulation are now being leveraged to reduce the subsidy bill on both kerosene and liquefied petroleum gas. . 

The transformative Jan Dhan Yojana, which has provided access to financial services to millions of poor, or leveraging the potential of Aadhaar, or even getting the better off to surrender LPG subsidy voluntarily and use the money so saved to provide LPG connections to poor rural households, and finally getting the GST Bill moving, are all signal achievements.. The challenge before Modi now is to deliver on his latest slogan: “Reform, perform, transform.”

10315 - HE MULTIPLE FACETS OF AADHAAR - Daily Pioneer

HE MULTIPLE FACETS OF AADHAAR

Monday, 08 August 2016 | Himanshu Lal | in Oped

The Government’s decision to link direct benefit transfers with Aadhaar can be a game-changer in a sense that it will empower not only various schemes but also numerous sections of the society. Sooner or later, Aadhaar has to become the aadhar of the country

Aadhaar is a 12-digit unique   identification number issued by the Unique Identification Authority of India (UIDAI) for all residents in the country on a voluntary basis. The number is stored in a centralised database and is linked to basic demographics and biometric information-photograph, 10 fingerprints and iris of each individual. It ensures uniqueness and there can be no space for duplicity in the future as per the present technology.

Initially, Aadhaar was used only for identification purpose, but now, it is being used as a device for direct benefit transfers (DBT) to the poor and needy under various Government schemes. Aadhaar is a real game-changer for this country. Till now, due to various cases in the Supreme Court, only a few schemes related to the poor and needy viz, the National Rural Employment Guarantee Act (MNREGA), the National Social Assistance Programme, the Pradhan Mantri Jan-Dhan Yojana, various scholarship programmes, LPG subsidy etc, could become Aadhaar-based.

The total savings on behalf of leakages due to Aadhaar-based seeding, during the last five and a half years, tantamount to billions of rupees. A World Bank study which applaudes the Aadhaar-based seeding points out, “India’s fuel subsidy programme, implementing cash transfers to Aadhaar-linked bank accounts, to buy liquefied petroleum gas cylinders, saved about one billion dollar per year when applied throughout the country.”

According to another report, the implementation of Aadhaar enabled four States viz, Andhra Pradesh, Telangana, Pondicherry and Delhi save a total amount of Rs 2346 crore.

On the other hand, the Government estimates to have saved over Rs 27,000 crore by cash transfers for payments to beneficiaries under various welfare schemes in the last two years. DBT has resulted in significant savings across welfare schemes. It has also resulted in weeding out of duplicate beneficiaries. For instance, over 1.6 crore (16 million) bogus ration cards have been deleted, resulting in savings to the tune of Rs 10,000 crore.

Similarly, 3.5 crore duplicate beneficiaries were weeded out in the PAHAL scheme, resulting in savings of over Rs 14,000 crore in 2014-2015 alone. Similar efforts in MGNREGS led to a saving of Rs 3,000 crore — roughly 10 per cent of the entire annual budget of the reform. Several States and Union Territories too have achieved significant savings through DBT.

On April 4, UIDAI generated the 100th crore Aadhaar. Also, the Aadhaar (Targeted Delivery of Financial and other Subsidies, benefits and services) Act, 2016, was passed on the March 11 by the Lok Sabha.

The generation of the 100th crore Aadhaar and the passage of the Aadhaar Act will be remembered as two landmark events in the history of India. With this, Aadhaar has become the largest online digital identity platform in the world. Not only this, presently, it is the world’s one of the most secured data repository system too. Functionally, it is better than the digital identity system of Chile, Ghana, Pakistan, South Africa, Turkey or Egypt.

Very few people are aware of the fact that Aadhaar-based identification system is more mammoth, more secure and more unique than the United States’ Social Security number-based identification system which does not cover the biometrics and iris of individual. It covers only the demographic data of an individual and hence, it cannot be unique and secure. It can be fudged, altered or manipulated which is not true for Aadhaar-enabled system in India.

The passage of the Aadhaar Act, 2016, will facilitate the formation of a statutory unique identification authority of India and the linkages of Aadhaar-enabled system to various schemes, programmes and services of Government of India, starting from taking benefit of a scheme to railway reservations, to income tax collections.   Every scheme and service in India can be connected to the Aadhaar network.

This new Act provides for several measures for the security and confidentiality of information. There are restrictions on sharing of information and there are punishments and penalties for misuse of information/impersonation in the Act.

Hence, the new Aadhaar Act, at one time, provides for the facilitation of the Aadhaar-based linkages with the different schemes/services of Government of India which will help save billions of exchange every year. At the same time, it has tried to secure the information provided by citizen in the best possible way by having various provisions to ensure the security of information.

The future of it lies in the speed with which the services and schemes are linked with Aadhaar in as little time as possible.  Every activity of business, enterprise or Government has a potential of being linked with Aadhaar-based system which, at this time, is one of the most well-secured information infrastructure of the world.

Even mobile companies can make their mobiles Aadhaar-enabled. This will help the citizens avail any service from a click of a mobile in a secured way. Also, the Government of India spends huge money in elections and in managing the election structure. Aadhaar-enabled voting system, if implemented in the future, will not only help the Government save billions of rupees, which are being incurred in providing EPIC cards, revision of electoral rolls, and eliminating duplicate entries from such lists, but will also help generate every individuals vote. Sooner or later, Aadhaar has to become the aadhar of the country.

This very Aadhaar programme,  ideally supports the motto of ‘maximum governance and minimum Government’, that was echoed by the NDA Government at the Centre. This will surely help in heralding a new age in India’s governance system which is badly in need of an immediate overhaul.

While bringing governance to the maximum use of people, through the medium of information and communication technology, Aadhaar can truly be regarded as one step ahead in an emerging global power like India. Indians having an identity

proving to be more than what they have in the past, Aadhaar needs to be promoted across the country through education campaign in schools and in news media in a massive way what it is done today.

(The writer is Additional Director General of UIDAI)

10302 - Nearly 58 lakh pensioners bank accounts to come under PMJDY - India.com

Nearly 58 lakh pensioners bank accounts to come under PMJDY

The move is being seen as a part of the Centre's plan of bringing all subsidies and welfare schemes under the Direct Benefit Transfer (DBT) net by March 31, 2017.

By Press Trust of India on August 2, 2016 at 5:24 PM

New Delhi, Aug 2 :  About 58 lakh pensioners’ bank accounts may be subsumed under Pradhan Mantri Jan-Dhan Yojana (PMJDY), a national mission for financial inclusion. The move is being seen as a part of the Centre’s plan of bringing all subsidies and welfare schemes under the Direct Benefit Transfer (DBT) net by March 31, 2017.

The Ministry of Personnel, Public Grievances and Pensions has been asked to examine the possibility of converting pensioners’ accounts into PMJDY account, as per a communique issued by Cabinet Secretariat. All banks have earlier been directed to give priority to pensioners visiting their branches for seeding of Aadhaar numbers with their accounts. There are about 58 lakh central government pensioners. (ALSO READ: Jan Dhan has 21 crore accounts, mobilised Rs 32,000 cr deposits: Pranab Mukherjee)

The Unique Identification Authority of India (UIDAI) issues Aadhaar–a 12-digit unique identification number–which acts as a proof of identity and address, anywhere in the country. The DBT Mission, which functions under the Cabinet Secretariat, has asked Department of Financial Services (DFS) to examine the possibility of seeding PMJDY account with the Aadhaar to be used as primary account (single account) for transfer of all government benefits, the communique said.

10260 - Jan Dhan, Aadhaar, Mudra: Making women a visible part of Indian growth story - Financial Express

Jan Dhan, Aadhaar, Mudra: Making women a visible part of Indian growth story

In the Indian context, studies related to credit accessibility of women show that relative access to institutional credit of rural women may be limited vis-a-vis their urban counterparts...

By: Soumya Kanti Ghosh and Kajal Ghose | Published: July 21, 2016 6:12 AM

One proxy for women empowerment is the status of rural women in India.

If you thought there is no prize for guessing what JAM (Jan Dhan, Aadhaar and mobile in policy parlance) stands for, then you are mistaken. Using a large random sample of Jan Dhan and Mudra accounts opened by the State Bank of India (SBI) between August 2014 and March 2016, we found an enabling traction across Jan Dhan, Aadhaar and Mudra loans—this is our terminology for JAM.

The logical corollary is a discernible evidence of women empowerment through JAM by allowing them to have better access to credit. We also found that in states with high women literacy, there were more inward remittances, irrespective of gender, and concomitant cash withdrawals.

First, let us take up the issue of women empowerment through JAM. The UN defines women empowerment as the process by which women take control and ownership of their lives through the expansion of their choices.

In general, women empowerment indicates an increase in economic, social, spiritual and political strength, boosting their self-esteem, enlarging their decision-making power and allowing them better access to resources. All this leads to a positive attitude after all.

One proxy for women empowerment is the status of rural women in India. Rural women play a significant role in the life of the society, and national development is not possible without nurturing this segment. In the Indian context, studies related to credit accessibility of women show that relative access to institutional credit of rural women may be limited vis-a-vis their urban counterparts.

In our study, we found that there is indeed traction, though limited, across Jan Dhan and Mudra accounts—primarily in the shishu category of loans, that is loans less than R50,000. Interestingly, if we apply the same percentage of the SBI overlap ratio—that is people having both a Jan Dhan account and a Mudra loan—to the aggregate Jan Dhan accounts opened till date, then we have close to 100 lakh Mudra account holders with a Jan Dhan account.

The good thing is that 23% of Mudra loan account holders with the SBI are women with an average ticket size of around R55,000. Alternatively, this implies that most of the women account holders have taken loans under the shishu category only. In contrast, 65% of the Mudra loan account holders are men with an average exposure of around R87,000, of which there is a good chunk from the economically backward classes.

But the most remarkable finding was the distribution of women entrepreneurs across India, with 36% of the accounts coming from southern India (Andhra Pradesh, Tamil Nadu and Telangana) and 16% from eastern India (West Bengal, Odisha and Assam). Maharashtra, Gujarat and Madhya Pradesh accounted for another 17%. Thus, it clearly seems that states that were laggards in terms of economic growth in the past are seeing more traction in women entrepreneurship through the Mudra route.

In terms of the average exposure amount for women entrepreneurs across states, results were even more interesting. On an average, in most of the states as mentioned above, activities were related to grocery and kirana stores, retail shops and even public utility services. But in some of the smaller states like Uttarakhand, Jammu and Kashmir, Nagaland, Mizoram, Himachal Pradesh, Arunachal Pradesh and even eastern states like Bihar and Jharkhand, the average exposure was significantly higher than the national average. It is possible that though limited in number, loans may have been availed by women in such states for activities like buying trucks, cars for passenger and freight transport, given the inhospitable terrains which necessitates the need for an efficient transport infrastructure.

In this context of empowering women, an analogy may be drawn directly to the self-help group or SHG-bank linkage programme—often considered as the ultimate benchmark in women’s empowerment and socio-economic development. Loans like the ones under the Mudra scheme are analogous to micro-finance and remain a powerful tool for development as it brings down the capital and the operating costs and helps women entrepreneurship blossom from mere superficiality to productivity.

Now coming back to our second major finding: Nearly 35% of the total inward remittances in the SBI sample are also from states with high women literacy rates, of which 25% are below the age group of 45 years. Similarly, 48% of the cash withdrawal—with a larger probability of women withdrawing cash from their accounts compared to their male counterparts—also comes from such states. This clearly indicates that the inward remittances sent by their male counterparts are possibly being put to more productive use by the female folks, facilitating independent decision-making.

To sum up, it has been now been well-researched that investing in women’s capabilities results in the well-being of the family, especially children. The experience of the successful SHG-bank linkage is a case in point in the Indian context. There is no harm in emulating this in the context of better Mudra loan targeting by using the Jan Dhan account interface. As our results show, even as women entrepreneurs, specifically the rural ones, are somehow using the Mudra route, we must encourage them even more.

This can be achieved by better targeting using Big Data analytics. For example, states with high literacy across women may be specifically targeted for more of Mudra loans. Simultaneously, the government must think seriously about creating a database of women entrepreneurs across states pursuing similar activities.

This will create a successful Mudra-bank linkage. After all, as the SHG example shows, women save more, repay on time and promptly attend SHG meetings. This is all we need for making women a visible part of Indian growth story.

Soumya Kanti Ghosh is chief economic advisor, Kajal Ghose is head of analytics, SBI. Views are personal

10243 - Maharashtra posts 100% enrolment of adult Aadhaar Cards - TNN

Maharashtra posts 100% enrolment of adult Aadhaar Cards

Priyanka Kakodkar | TNN | Jul 18, 2016, 03.26 PM IST

MUMBAI: The Maharashtra government claims to have achieved 100% Aadhaar Card enrollment in the state.

It also claims that 73% of the population has a bank account under the Jan Dhan Scheme.

The state also claims that it has started providing Aadhaar Cards for the new borne babies along with their birth certificate and also providing Aadhaar Cards for children below the age of five years at anganwadis. Children below the age of 18 years are also being provided the facility of Aadhaar Cards at school, officials said.