This is a great move, a large number of India's poor get into debt easily and get exploited by predatory money-lenders. Encouraging to have bank accounts will not only provide them a safety net but would also incentivise saving money, rather than pissing it off.
(Many poor people either spend the money on booze, or abandon their families because they are too much of a financial burden, or have a mentality of "let me enjoy my life today, the future is uncertain")
However, this move proposes a huge challenge in a country like India where record-keeping is extremely messy in rural isolated areas. Many people still don't have State IDs, and there is a high chance of corruption here, with local officers accepting bribes to get your life insurance done, despite not being eligible, or in extreme cases, exhort money from poor and threaten to erase their records if they don't pay up.