India PM Modi Promises Bank Account for Every Household

Indians sort coins offered by devotees to the river
Indians sort coins offered by devotees to the river, which they collected by using magnets, at "Sangam," the confluence of the Ganges and Yamuna,and mythical Saraswati river, during the annual traditional fair 'Magh Mela' in Allahabad, India, Wednesday, Jan. 29, 2014. Hundreds of thousands of devout Hindus are expected to take holy dips at the confluence during the astronomically auspicious period of over 45 days celebrated as Magh Mela.Rajesh Kumar Singh / AP, file

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Prime Minister Narendra Modi will promise to provide a bank account for every Indian household when he launches a major initiative that could save billions of dollars in welfare spending on Thursday. India has grown to become Asia's third largest economy, but nearly two-fifths of its 1.27 billion people do not have a bank account. This leaves them dependent on moneylenders and other informal financing routes. "There is an urgency to this exercise as all other development activities are hindered by this single disability," he said in a Twitter post. Modi won India's biggest electoral mandate in 30 years in May with a promise to revive India's flagging economy.

Over 40 percent of Indians live on less than one dollar a day. The launch of the Jan Dhan Yojana, or the Scheme for People's Wealth, comes weeks after Modi blocked a global trade deal, saying it threatened the interests of poor farmers. Under the banking scheme, account holders would get a debit card and accident insurance cover of up to $1,654.


- Reuters