Success or failure of an innovation also depends upon use of technology and this can be said more specifically in the context of innovations in the financial sector in India. Starting from Pradhan Mantri Jan Dhan Yojana to Pradhan Mantri MUDRA Yojana or even Goods and Services Tax (GST) all are being implemented with the help of information technology making them emphatic and more importantly cost-effective, both for the Government as well for the masses. Most of these innovations are complimenting each other and thus providing a bigger basket of schemes for welfare of the common man.

Recent innovations in financial and banking sectors which have impacted the economy and benefited the common man:

1. Pradhan Mantri Jan Dhan Yojana (PMJDY):

• The scheme aims to ensure access to various financial services like availability of basic savings bank account access to need based credit, remittances facility, insurance and pension to the excluded sections i.e. weaker sections and low-income groups.
• This deep penetration at affordable cost is possible only with effective use of technology.
• This scheme was an innovation as significant changes in the earlier scheme of financial inclusion – Swabhimaan was made.
• PMJDY was implemented with more of machine than a concrete structure.
• The scheme also prescribes plastic currency in the form of RuPay card for all such accounts making a bigger impact in digital payment system.
• The scheme envisages channelizing all government benefits to the accounts and pushing the Direct Benefits Transfer (DBT) scheme of the Union Government. DBT transfer is a win-win situation for both the common man and the Government.
• Another key feature of PMJDY is ease of opening bank accounts.
• The Press Release said that those persons who do not have any of the ‘officially valid documents’ can open “Small Accounts” with banks.
• Small Accounts: A “Small Accounts” can be opened on the basis of a self-attested photograph and putting his/her signatures or thumb print in the presence of officials of the bank. Such accounts have limitations regarding the aggregate credits (not more than Rs one lakh in year), aggregate withdrawals (nor more than Rs ten thousand in a month) and balance in the accounts (not more than Rs fifty thousand at any point of time) These accounts would be valid normally for a period of twelve months. Thereafter, such accounts would be allowed to continue for a further period of twelve more moths, if the account-holder provides a document showing that he/she has applied for any of the Officially Valid Document, within 12 months of opening the small account.
• Accidental insurance cover for new RuPay card holders to be raised from Rs 1 lakh to Rs 2 lakh to new PMJDY accounts opened

2. Insurance and Pension Schemes for Social Security:

• Government innovated schemes and introduced three schemes, two for insurance three schemes, and two for insurance and one for pension.
• All are targeted especially for the poor and the under-privileged.

1. Scheme for Life Insurance:
   • The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) is a one-year life insurance scheme, renewable from year to year, offering coverage for death due to any reason and is available to people in the age group of 18 to 50 years (life cover upto age 55) having a savings bank account who give their consent to join and enable auto-debit Life cover of Rs 2 lakhs is available for a one year period at a premium of Rs 330/- per annum per member and is renewable every year which means premium of less than Rs 1 per day.
   • It is offered/administered through LIC and other private. Life Insurance companies a person can join PMJJBY with one Insurance company with one bank account only.

1. Death and Accident Cover through non-life insurance scheme:
   • Pradhan Mantri Suraksha Bima Yojana (PMSBY) is aimed at covering the uncovered population at highly affordable premium of just Rs 12 per year i.e. Re 1 a month.
   • The Scheme will be available to people in the age group 18 to 70 years with a savings bank account who give their consent to join and enable auto debit.
   • Under the said scheme, risk coverage available will be Rs 2 lakh for accidental death and permanent total disability and Rs 1 lakh for permanent partial disability, for a one-year period stretching.
   • It is offered by Public Sector General Insurance Companies or any other General Insurance Company who are willing to offer the product on similar terms with necessary approvals and tie up with banks for this purpose.
   • Further, in order to assure a hassle-free claim settlement experience for the claimants a simple and subscriber friendly administration and claim settlement process has been put in place.
   • An IT enabled, web-based system is there to keep the claimants informed seamlessly about the progress and status of the claim, till it’s settlement.

1. Pension Scheme:
   • Atal Pension Yojana (APY) is open to all bank account holders.
   • However, the Central Government is co-contributing 50 percent of the total contribution or Rs 1000 per annum, whichever is lower, to each eligible subscriber, for a period of 5 years, i.e., from Financial Year 2015-16 to 2019-20, who joined the scheme before December 31, 2015 and who are not members of any statutory social security scheme and who are not income tax payers.
   • The subscribers would receive the fixed minimum pension of Rs 1000 per month, Rs 2000 per month, Rs. 3000 per month Rs. 4000 per month, Rs. 5000 per month, at the age of 60 years, depending on their contributions, which itself would be based on the age of joining the scheme therefore, the benefit of minimum pension would be guaranteed by the Government.
   • The minimum age of joining APY is 18 years and maximum age is 40 years.

3. MUDRA:

• MUDRA scheme aims at Non-Corporate Small Business Segment (NCSB) comprising of millions of proprietorship/partnership firms running as small manufacturing units, service sector units, shopkeepers, fruits/vegetable vendors, truck operators, food-service units, repair shops, machine operators, small industries, artisans, food processors and others, in rural and urban areas.
• It is a refinancing Institution and does not lend directly to the micro entrepreneurs / individuals.
• Mudra loans under Pradhan Mantri Mudra Yojana (PMMY) can be availed of from nearby branch office of a bank, NBFC, MFIs etc.
• Loans can be availed upto Rs 10 lakh under three products namely ‘Shishu (loan up to Rs 50,000)’ ‘Kishore (loan between Rs 50,000 to Rs 5 lakhs) and ‘Tarun (loan between Rs 5 lakhs and Rs 10 lakhs)’ to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur and also provide a reference point for the next phase of graduation / growth.

4. Stand-Up India:

• In order to promote entrepreneurship among Schedule Caste/Schedule Tribe and women, it is an innovation over existing credit mechanism of various banks and is intended to facilitate bank loans between Rs 10 lakh and Rs 1 crore to at least one SC/ST borrower and at least one women borrower per bank branch for setting up greenfield enterprises which may be in manufacturing, services or the trading sector.
• The scheme which is being implemented through all Scheduled Commercial Bank is to benefit at least 2.5 lakh borrowers. The scheme is operational and the loan is being extended through Schedule Commercial Banks across the country.

These financial innovations have made life made easier for a larger section of people. And the best thing is that changes are being incorporated based on field experience making these schemes more effective.