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World Bank applauds India’s progress in DPI
India's digital public infrastructure (DPI), which includes the JAM Trinity and PMJDY, has propelled the country to over 80% financial inclusion.
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A recent World Bank report praised India's Digital Public Infrastructure (DPI) for its transformative effect on the country. The G20 Global Partnership for Financial Inclusion document commended India's approach under the Central Government.
The report lauded India's DPI strategy, noting that the country accomplished in just six years what would have taken roughly five decades to accomplish. A significant contributor to this success was the JAM (short for Jan Dhan-Aadhaar-Mobile) Trinity, which boosted the financial inclusion rate from 25 per cent in 2008 to over 80 per cent of adults in the past six years, effectively shortening the journey by up to 47 years.
Other factors, such as the legal and regulatory framework, national policies to expand account ownership, and the use of Aadhaar for identity verification, were equally important, the report emphasized.
Since its launch, the Pradhan Mantri Jan Dhan Yojana (PMJDY) has seen a threefold increase in accounts, reaching 462 million by June 2022, with women owning 56 percent of these accounts.
In just five months, the Jan Dhan Plus program recorded over 12 million female customers and a 50 percent increase in average balances. It is estimated that by engaging 100 million low-income women in savings activities, public sector banks in India can attract approximately Rs 25,000 crore ($3.1 billion) in deposits.
As of March 2022, India's Government to Person (G2P) Payments architecture transferred approximately $361 billion directly to beneficiaries via 312 key schemes, resulting in savings of $33 billion.
The report also highlights the success of the Unified Payments Interface (UPI), with more than 9.41 billion transactions valued at about Rs 14.89 trillion in May 2023 alone. For the fiscal year 2022–23, the total value of UPI transactions accounted for nearly 50% of India's nominal GDP.
DPIs have not only benefited the public sector but have also enhanced efficiency for private organizations. Some Non-Banking Financial Companies (NBFCs) reported an 8% higher conversion rate in SME lending, a 65% reduction in depreciation costs, and a 66% decrease in costs related to fraud detection. Industry estimates even indicate that banks' customer onboarding costs decreased significantly, from $23 to just $0.1, with the implementation of DPIs.
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