The implementation of life insurance for farmers from August 15 under a new scheme ‘Rythu Bima’ has cast another responsibility on the State government, that of ensuring bank accounts for nominees.
A senior official told The Hindu that the saturation point was already reached in the matter of bank accounts of nominees in the State.
The problem, however, was with the Jan Dhan accounts of small farmers which were opened as part of financial inclusion programme of the Central government to see every citizen held an account. Since the maximum withdrawal per transaction in these accounts was only ₹ 50,000, the credit of ₹ 5 lakh to the account holders by the Life Insurance Corporation as mandated by the State government within 10 days of the death of the farmers will require withdrawals at least 10 times. And that too when the families were in grief.
No upgrade
In these circumstances, the government appealed to the bankers to upgrade the Jan Dhan accounts into regular savings accounts but the banks have expressed helplessness. The appeal was made at a recent meeting of the State-level bankers committee which was attended by Finance Minister Eatala Rajender.
Chief General Manager of SBI Swaminathan J. clarified to the Minister that there was no question of upgradation of the accounts but the nominees can approach the banks for opening of fresh accounts with Know Your Client (KYC) norms.
The Jan Dhan accounts, on the other hand, came with liberal KYC norms and were zero balance accounts with a window for overdraft loan of ₹ 5,000.
Multiple insurance
On one hand, the government is striving for the conversion of Jan Dhan accounts into regular bank accounts and, on the other, grappling with multiple life insurance schemes in various departments which were already accessed by farmers. Insurance cover in force for toddy tappers, dairy farmers, drivers in unorganised sector, labourers and women, all of whom were also farmers who enjoyed investment support of government and eligible for Rythu Bima, has raised concerns of duplicate benefits flowing out.
Some 15 lakh farmers are already availing insurance from other departments, according to State-level Farmers Coordination Committee Chairman Gutha Sukhender Reddy.