The Reserve Bank of India has asked banks to bring in metropolitan areas under the lead bank scheme for the first time, a move aimed at providing to the urban poor doorstep banking and direct transfer of cash benefits under social welfare programmes. 

Financial exclusion is not merely a rural phenomenon, the central bank has admitted, noting that it is in fact widespread in the metros while directing that the lead bank scheme dating to 1969 be extended. Lead bank scheme is an integrated mechanism to extend banking facilities to consumers, especially those who belong to the economically weaker sections. 

The lead bank in every district assumes leadership role for coordinating the efforts of the lenders. The RBI has advised the banks to hold deposit camps for opening bank accounts of all eligible individuals and link these to Aadhaar numbers. It has also asked the banks that they should have an effective mechanism in place to monitor and review the progress of this drive. 

The central bank is in favour of empowering banks' regional offices and branches. Banks are preparing a comprehensive financial inclusion plan for 2013-16 to meet this objective. Over the past three years, banks have opened outlets in more than two lakh villages but these branches are yet to generate any meaningful business. 

The banking regulator has also emphasised on financial literacy, the lack of which led to the mushrooming of chit funds or companies running Ponzi schemes. These dubious companies are more active in regions which have gaps in banking access and financial literacy. "The triad of financial inclusion, financial literacy and consumer protection have been recognised as intertwining threads in the pursuit of financial stability," the RBI has said. (Economic Times)