Washington: Hailing Prime Minister Narendra Modi's 'Jan Dhan Yojna', the US-India Business Council (USIBC) on Friday described it as an "important step" toward the next stage of India's social and economic development.
In a statement, USIBC said Modi's announcement of "a new pan-India comprehensive financial inclusion plan that expands access to financial services to a wider cross-section of India's citizens" is "an important step toward the next stage of India's social and economic development".
American investors are grateful for the Government of India's stewardship of the Indian economy, said the USIBC acting president Diane Farrell.
"USIBC looks forward to continuing to bolster industry's engagement across pensions, payments, banking, insurance and asset management," she said.
Modi on Friday launched 'Pradhan Mantri Jan Dhan Yojana' to help the poor open bank accounts which will come with the facility of a debit card and an insurance cover of Rs 1 lakh.
"India is at a cross road with a unique opportunity to reinvent their approach to financial inclusion," said Vijay Advani, USIBC Board Member and executive vice president of Franklin Templeton Investments.
"I am very pleased that the Government of India is focusing on financial inclusion given that many Indians do not have access to basic banking and financial services," he said.
"While the household savings rate is high in India, most of these savings find their way into unproductive physical assets such as gold and real estate. Any efforts to increase the share of financial assets and channel the high savings into capital markets, through financial institutions such as banks, mutual funds and insurance companies would be a positive for investors and the economy at large," Advani said.
The goal of ensuring access to affordable financial services including banking, investments, credit, insurance, pension facilities and most importantly, financial literacy appears to be within the reach of India's vast population, he said.
"A lot, however, depends on how various components of this plan come together and how effectively the Government is able to scale up participation from the private, public and social sectors," Advani said.
"We are pleased to see the focus & strong commitment that Prime Minister has made to financial inclusion drive. Strong execution of these actions will enable acceleration of economic growth," said Kiran Shetty, regional vice president and managing director, South Asia, Western Union.
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