Narendra Modi in Singapore: PM has done more than any other leader to connect India to financial mainstream

Sreemoy Talukdar
Naysayers may deride the NDA’s push for Aadhaar, Jan Dhan, RuPay, BHIM, demonetisation or GST but the fact remains that Narendra Modi has done more for inclusive development in India through technology and digitization than any other prime minister before him. His place in history is secured.

Naysayers may deride the NDA's push for Aadhaar, Jan Dhan, RuPay, BHIM, demonetisation or GST but the fact remains that Narendra Modi has done more for inclusive development in India through technology and digitization than any other prime minister before him. His place in history is secured.

Technology offers possibilities. But its power must be harnessed, and dots must be joined to bring about the desired change. The job is tougher in a country of this size, diversity and stage of development. It is tougher still when we consider that Modi has been in office for little more than four years €"a short time in the history of a nation. Yet in these four years, India has seen more people join the financial mainstream and reap the benefits of global digital revolution than in any other time in the past. While part of the trend is temporal, Modi must get a fair share of credit in final analysis.

What is denoted by the word 'financial inclusiveness', that was the central theme of the prime minister's keynote address on Wednesday at the Singapore Fintech Festival (SFF)?

According to the World Bank, "financial inclusion a key enabler to reduce extreme poverty and boost shared prosperity," and the World Bank Group hopes to achieve Universal Financial Access (UFA) by 2020.

"Unbanked" people do not have access to financial services and products, and therefore remain outside the development loop. By providing access to bank accounts through the Jan Dhan scheme and linking these to mobile and digital-payment mechanisms, Modi has helped India leapfrog a few stages in development.

The success of his efforts is reflected in the fact that India's score in financial inclusion now (2016) stands at 58 out of 100, with 14 districts having a 'Inclusix' score of 100. This score was 50.1 in fiscal 2013, according to the latest CRISIL report.

The index, which measures national financial inclusion €" up to the level of each of the 666 districts €" is based on data provided by the Reserve Bank of India (RBI), the MicroFinance Institution Network, and the Insurance Information Bureau of India. CRISIL reports that this record growth in financial inclusion owes to strong growth in deposits and credit accounts, and it says this has been made possible due to "Policy measures such as the Pradhan Mantri Jan-Dhan Yojana, and steadfast focus on the unbanked regions (that) have driven India's financial inclusion agenda over the past 3 years. As many has 336 out of 666 districts have secured 'Above-average' rating.

Updated 2018 figures may take this initiative up by a few more notches. Therefore, when Modi tells the audience at SFF €" the world's largest event on financial technology which drew 30,000 participants from over 100 countries last year €" that "my government came to office in 2014 with a mission of inclusive development that would change the lives of every citizen, even the weakest in the remotest village", his words must be taken seriously.

The SFF, now in its third year, involves a three-day conference, and exhibition of FinTech firms and capabilities, a global competition of related solutions and a platform for matching entrepreneurs and investment capital. As the first world leader to address the gathering, the prime minister touched upon the key metrics of this achievements. He mentioned financial inclusion as a "reality for 1.3 billion Indians. We have generated more than 1.2 billion biometric identities (Aadhaar) in just a few years. Through Aadhaar and cellphones, we launched Jan Dhan Yojna. In three years, we have opened 330 million new bank accounts. These are 330 million sources on identity and dignity and opportunities. Less than 50 percent of Indians had bank accounts in 2014. Now it is nearly universal."

Calling the fusion of a billion biometric identities, more-than-a-billion bank accounts and more-than-a-billion cell phones as the "biggest infrastructure", Modi related how "rapidly rising digital transactions powered by Rupay and BHIM" are powering fintech revolution in India. "Today, 128 banks in India are connected to UPI. Transactions on UPI grew 1500 times in the last 24 months. Every month, the value of transaction is growing by over 30 per cent," he said.

These are not empty figures. According to latest figures from IT ministry, number of digital payment transactions have leaped by a staggering 207 percent to Rs 244.81 crore in August 2018, compared to Rs 79.67 crore in October 2016. Total value of such transactions, which stood at Rs 108.7 lakh crore in October 2016, increased 88 percent to Rs 204.86 lakh crore in August 2018, said the statement.

This explosion has touched home-grown payment systems such as the RuPay cards and Bharat Interface for Money (BHIM) UPI mechanism, which together "have garnered over 60 percent market share of the digital transactions business, pushing back global giants such as Mastercard and Visa."

Modi also highlighted how digitisation and fintech remove anonymity and help build a healthy economy by fixing accountability, removing bureaucratism and middlemen, and prevent leakages of public funds. "Digital technology is also introducing transparency and eliminating corruption through innovation such as the Government e Marketplace," Modi said, adding that Fintech can be used to prevent money laundering and other financial crimes.

"The future of Fintech and Industry 4.0 is emerging in India. I say this to all the Fintech companies and startups €" India is your best destination," said Modi. Detractors may disagree, but it is hard to argue against the scale of achievements of an activist prime minister. Facts are sacred, unlike opinions.

Also See: Narendra Modi in Singapore: At Fintech Festival, PM cites Aadhaar, UPI; says inclusive growth stems from digitisation in India

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