RBI has high ambitions for its financial inclusion scheme. It plans to provide banking access to all villages with population of over 2,000 by March 2012. There are 72,800 villages in the country identified as falling into this category. It is coordinating with several banks in this matter. It has asked banks to ensure that at least 25 per cent of the new branches being opened during this year are located in rural areas. In last two years 20% of all branches opened by the Scheduled Commercial Banks have been in rural areas, with emphasis on areas with population over 2000 but no banking facility. Business Correspondents are also a major part of this scheme.
Part of this exercise also includes providing of banking facilities to villages at the their doorstep. For this purpose, villagers would be issued Smart Cards, which they could use to manage their bank accounts. The smart cards come with a zero balance saving account and will be linked to UID. All government benefits would be eventually routed through this bank account. As part of the scheme business correspondent with a hand-held swipe machine would be required to go from door to door, for facilitating withdrawal / deposit of funds.
As part of this scheme around 1000 villages in Bihar, including some naxal affected districts, have been partly covered. While most bankers are going for the business correspondent model, SBI has preferred to put kiosks with machines at each village. It has covered around 400 villages. In Bihar around 9230 villages are planned to be covered by March 2013.
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