Odisha CM Launches ‘AMA Bank’ for Gram Panchayat Banking

Chief Minister Naveen Patnaik launched the “AMA Bank” scheme, a historic initiative aimed at providing banking services through CSP Plus banking outlets in all unbanked Gram Panchayats (GPs) of Odisha. This visionary project, unveiled in the first phase, marks Odisha as the pioneer state in India to conceptualize and implement such a comprehensive scheme for financial inclusion.

CSP Plus Outlets: A New Model for Financial Inclusion

• In the initial phase, 750 CSP Plus outlets, strategically spread across all 30 districts, were dedicated to the people of Odisha.
• Chief Minister Naveen Patnaik expressed confidence that the innovative CSP Plus model would serve as a blueprint for the entire nation.
• This model aims to bridge the gap in financial services accessibility, particularly in rural areas where the geographical penetration of traditional banks has been a longstanding challenge.

The Imperative of Financial Inclusion

• Financial inclusion stands as the bedrock for social and economic progress, ensuring the empowerment of people at all levels.
• The government recognizes that achieving inclusive growth is intrinsically tied to providing financial inclusion to every citizen.
• The challenges posed by a lack of brick-and-mortar bank branches in approximately 65% of gram panchayats necessitated a revolutionary approach to ensure the last-mile delivery of public services.

Challenges Addressed by AMA Bank

• With a vast number of gram panchayats lacking a physical bank presence, accessing banking services and receiving Direct Benefit Transfers posed severe challenges for rural Odisha.
• Recognizing the urgency, the Odisha government collaborated with six public sector banks — SBI, PNB, UBI, UCO Bank, Bank of India, and Bank of Baroda — to launch the “Ama Bank” scheme.
• This initiative aims to establish low-cost brick-and-mortar micro bank branches that offer a comprehensive range of banking services.

Ama Bank’s Services and Impact

• Ama Bank, situated between a Business Correspondent (BC) and a small bank branch, is designed to provide essential banking services such as deposits, advances, remittances, loans, Aadhar Enabled Payment System, credit linkage to Self-Help Groups (SHGs), and coverage under social security schemes.
• Doorstep banking services for senior citizens, differently-abled individuals, and pregnant women will be a hallmark of this inclusive scheme, ensuring hassle-free access to Direct Benefit Transfers.

Timely Benefits for Rural Odisha

• The implementation of Ama Bank is set to alleviate the challenges faced by the rural population. The scheme promises to be a catalyst for inclusive growth and empowerment for the people of Odisha.
• No longer will the poor have to travel long distances to access various government schemes, including Old Age Pension (OAP), KALIA MAMTA, or apply for small business loans.

Phased Implementation and Government Support

• The ambitious scheme will be rolled out in a phased manner, with the goal of covering all 4373 unbanked Gram Panchayats within the current financial year (2023-24). A provision of Rs. 500 Crores has been earmarked to support the implementation of this transformative scheme.
• The Odisha government is taking substantial steps to ensure the success of Ama Bank by providing rent-free banking spaces for five years and bearing one-time expenses for fixed and recurring costs over a three-year period.

Important Questions Related to Exams

1. What is the aim of “AMA Bank” scheme?

Answer: The “AMA Bank” scheme aims to provide banking services through CSP Plus outlets in all unbanked Gram Panchayats (GPs) of the state, making Odisha the pioneer state in India to conceptualize and implement such a comprehensive scheme for financial inclusion.

2. Which public sector banks collaborated with the Odisha government for the implementation of “AMA Bank” scheme?

Answer: The Odisha government collaborated with six public sector banks, namely SBI, PNB, UBI, UCO Bank, Bank of India, and Bank of Baroda, for the implementation of the scheme.

3. What additional services does “Ama Bank” offer, for the rural population?

Answer: “Ama Bank” scheme offers doorstep banking services for senior citizens, differently-abled individuals, and pregnant women, ensuring hassle-free access to Direct Benefit Transfers and addressing the financial needs of the rural population.

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