FINANCIAL INCLUSION AND STUDENTS

Social justice has been accorded top priority in the Constitution of India.
Growth with justice has been at the core of the ongoing economic and
financial sector reforms. Besides, Indian banks have been given the
responsibility of acting as the prime movers in the process of planned
development with the objectives of economic growth and social justice.
Banks have, therefore, inter alia, formulated various schemes to provide
access to the common man. owever, about si!ty percent of Indian
population is estimated to be outside the moneti"ed sector. #inancial
inclusion will ensure economic growth with social justice and harmony.
#inancial inclusion pursued by banks since $%%& envelopes the role of
'education( and what needs to be done with a clear cut plan and approach
)blue print* is to involve student participation + as a part of co+curricular
activity + to bring about dynamic and drastic positive changes in the
neighborhood by improving the ,uality of life of the underprivileged
sections of the community in accordance with the policy objectives of our
welfare Government and the proposal is a feasible one and shall serve as a
model at local, district, State and -ational level as well to meet the
aspiration s of the common human.
.he banking system is re,uired to ensure moneti"ation through coverage of
all the unbanked clusters with a population of $%%% by the year $%/$ and
according to the #inancial Inclusion 0lan, 1.&2 lakh villages are re,uired to
be covered to reach this target.

Student Participation
Students in India have a constructive role to play in nation building.
.herefore, it is proposed to select a few of them as pioneers on an
experimental basis, guide them to engage themselves in transforming the
lives of the economically poor and illiterate families in the neighborhood of
Colleges to positively contribute towards this national goal. .hese
students will ultimately become instruments of social change, in accordance
with the objectives of education itself. In the process, they begin to
understand the very purpose of studying 'banking( or 'finance( or
'economics( as a subject and are aware of suitable banking and insurance
products to recommend and deliver, to bring about desired positive changes
in real life of the weaker sections. .he method is application of the theory
into practice to promote social welfare.
3eserve Bank of India )3BI* notified on 4pril $&, $%%2 that banks could
engage individuals as Business #acilitators and a range of service providers
to act as Business Correspondents and also permit banks to charge fees from
customers for using them. 5icrofinance has generally taken one of the
following three forms: i) Self-Help roup !SH) programme that has
linkages with banks, ii) cooperatives, or iii) rameen bank branches.
"rgani#ed SHs consist of $% to $& people with similar socio-
economic and demographic characteristics !e.g., low-income women
in rural or urban slums). 'he purpose of the SHs is to help the
members save small amounts of money on a regular basis, to create
an internal insurance fund for members to draw on in times of
emergencies, to empower the members through collective decision-
making, and to extend uncollaterali#ed loans to group members.
Since $((&, the )ational *ank for +griculture and ,ural -evelopment
!)+*+,-) has experimented with creating linkages between SHs
and banks. Such banks lend through )on-overnmental
"rgani#ations !)"s) or directly to SHs. *anks continue to
encourage creation of relationships with SHs and institutions such
as .ost offices and /utual funds.
5icro credit e!tended to the small borrowers by various commercial banks
is reckoned as part of priority sector advances by the 3eserve Bank of India
and the Government of India. 5icro credit is defined as the provision of
thrift, credit and other financial services and products of very small amount
to the poor in the rural, semi+urban and urban areas for enabling them to
raise their income level and improve living standards. In sum, micro credit is
a linkage between the underprivileged citi"ens who do not have any security
to offer to procure even a small loan, and banks themselves.
.he -ational Bank for 4griculture and 3ural 6evelopment )-4B436*
administers and regulates the prescriptions through 3egional 3ural Banks
)33Bs* and other bank branches, including co+operative banks.
7uality of life of the common man is to be touched ultimately by the
banking system through the features of link 8SG, a popular bank product,
and 8 a bank which has become a part and parcel of contemporary banking
business.
4ccording to 0rof.5uhammad 9unus who has been awarded the -obel
0eace 0rice in $%%:, microfinance originated in India and it is not going as
fast as it should. owever, in Bangladesh, it has reached //; million people
in 1% years. 4t that rate, India should have reached /:% million.
.aking a cue from 0rof. 9unus, it is suggested that with student participation
)he has not suggested this while addressing at the 5umbai <niversity* we,
Indians can reach the underprivileged citi"ens faster to enable them to get
out of poverty. #or instance, bancassurance has already been in vogue in
India and if poor farmers are granted micro credit to spend on seeds,
fertili"er or land 8 whatsoever, and insurance is added, without any collateral
farmers( suicide can be avoided. In urban slums, it can transform the ,uality
of life of the people.
.he proposal is a feasible one and shall serve as a model as a pioneering
effort of the 5umbai <niversity to begin at local, district, State and -ational
level as well to meet the aspirations of the common human.

.he /$ digit '4adhaar( )<ni,ue Identification 4uthority of India* is a cost
effective way in reaching out to vast group of Indians hitherto financially
e!cluded by identifying them and to access to formal institutional finance
which would benefit the poor in the rural and urban India. =iable innovative
business model can thus be created in an approved manner utili"ing their
energy and increasing revenue for banks and also transformation.