UN Better than Cash Alliance: Economic Ramifications

UN Better than Cash Alliance: Economic Ramifications

Question. On the first anniversary of the flagship financial inclusion programme PMJDY, GoI is joining the UN based Better than Cash Alliance. Discuss the economic ramifications for this.

- Under PMJDY, around 180 million new accounts have been opened with deposits of USD 3.4 billion

- New partnership with the Better Than Cash Alliance comprising governments, companies and international organisations is a commitment to reduce cash in the economy

- Digital financial services also lower cost of providing financial services

- They make it convenient for poor people to access their accounts

About Financial Inclusion

- PMJDY has brought rural India into the financial system and enabled grassroots citizens to carry out financial transactions

- Digital financial services are important for implementation of goals and power of digital payments for meeting sustainable development goals

- Making digitization of payments top priority, GoI is promoting inclusive growth

- As a next step, bank accounts will extend insurance, pension and credit facilities to provide banking services for the unbanked

- Aadhar biometric Unique Identity Cards make it easier for people to access social benefits

- India’s fuel subsidy programme is the largest cash transfer programme in the world saving USD 2 billion

- By joining the Better than Cash Alliance, Indian government will be a research, technical and policy partner to create digital financial economy

Facts and Stats

- Better than Cash Alliance is to ensure acceleration of the transition from cash to digital payments to promote inclusive growth and end poverty

- UN Capital Development Fund is going to serve as the secretariat for the Better than Cash Alliance

- PMJDY aims to provide universal access to banking facilities and one basic banking account for each household with financial literacy on the rise.