How can we fix the the problem of "No frill" accounts in banks?

What needs to be done is to come up with a sure-fire to make sure that No Frills Accounts opened, will be used. If No Frills Accounts are used to deliver government assistance, account holders would be more incentivised to use their accounts.

There may not be any problem with No Frill A/s. This is all a savings account barring some minor aspects. In Banks one may open this a/c with Rs 50/- or without any money. Requirements of papers for KYC is bare menimum. No minimum balance criteria.

BUT the target group people did not understand it well. They did not 'use' his /her a/c widely and for all purposes in its right spirit. Mostly, they used it for encashing NREGP benefits and did not return twice. No Frill a/cs are to be popularised more and more.

Firstly, the problem of physical access to banks shouldn't remain acute. Secondly, low-income households shouldn't suffer from the misapprehension that banks are meant for richer and more educated people than themselves. They should be given proper information and knowledge of the target clientele. Finally, banks shouldn't be thrilled to open these accounts showing little activity and not seeming to merit the expense. All these barriers mean that even when banks open No Frills Accounts for excluded households, they may never visit a bank because they simply do not have a proper appreciation of what it means to have a formal banking relationship.