India’s journey toward financial inclusion has witnessed various innovations in policy over the last decade. The government’s JAM, which is the bedrock of the digitalisation drive to formalise the economy, has been the biggest game changer for the BFSI industry. JAM stands for ‘Jan Dhan Account – Aadhaar – Mobile’ and has revolutionised financial inclusion in India.
Speaking on the JAM trinity, Debasish Panda, Chairperson, IRDAI, said that the biggest game-changer for the BFSI industry has been the JAM trinity. “The Pradhan Mantri Jan Dhan Yojana, Aadhaar, and mobile connectivity have taken financial access to the last mile. Pradhan Mantri Mudra Yojana added a further fillip,” he said at the Mint BFSI Summit and Awards on Thursday.
The Jan Dhan Yojana provides basic savings bank accounts, Aadhaar offers a unique biometric identifier, and mobile penetration in the country is rapidly increasing – these are the main components of the JAM architecture.
He said in the insurance sector, Pradhan Mantri Jeevan Jyoti Beema Yojana and Pradhan Mantri Surakha Yojana have done a similar job as JAM.
“Pradhan Mantri Jan Aarogya Yojana from the health segment is complimenting the Pradhan Mantri Aayushman Bharat Yojana. For unorganised sector, the Atal Pension Yojana is going on,” he said.
Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) is a health insurance scheme implemented by the Ministry of Health and Family Welfare (MoHFW) in India. The scheme aims to provide cashless hospitalization care to underprivileged and vulnerable households through existing sub-centers and health and wellness centers (HWCs).
Ayushman cards are made under the Ayushman Bharat Pradhan Mantri, which according to the Ministry is the largest publicly funded health assurance scheme in the world and provides health cover of Rs 5 lakh per family per year for secondary and tertiary care hospitalisation.
As per the government’s statistics, the scheme currently covers 55 crore individuals, which is equivalent to 12 crore families. Additionally, several states and union territories that have implemented AB PM-JAY have independently extended the number of beneficiaries, at their own expense. Government data shows that as of December 20, 2023, around 28.45 Crore Ayushman Cards have been generated since the scheme’s initiation. Out of this total, approximately 9.38 crore Ayushman Cards were created in 2023 alone.
Announced in 2003, the Pradhan Mantri Swasthya Suraksha Yojana (PMSSY) aims to correct regional imbalances in access to affordable and reliable tertiary healthcare, as well as augment facilities for quality medical education across India.
Talking about the insurance sector, Panda said the insurance industry has matured. “The evolving landscape demands more freedom which needs regulatory overhaul. We undertook a 360-degree evaluation. It was found there are hindrances to the industry’s growth even in launching a new product.”
He added that a revised framework has been implemented to attract more consultants and create a new landscape that fosters competition and innovation. Regulatory processes have been streamlined, allowing for easier usage and filing.
“We have InsureTech team within IRDAI. Insurers are being nudged to adopt AA framework. 27 of them have registered,” he said.
Bima Vistaar
Talking about Bima Vistaar, Panda said Bima Vahak and Bima Sugam will be available seamless delivery of insurance products. He said Bima Sugam, a regulatory electronic marketplace, will remove information asymmetry and democratise it.
Bima Vistaar, the first-of-its-kind all-in-one affordable insurance product for life, health, and property cover, is set to be rolled out in the first quarter of the next financial year.
Also read: Irdai tells insurers to provide simplified policy information document starting January 1