Pradhan Mantri Jan Dhan Yojana (PMJDY), the country’s financial inclusion initiative launched six years ago, has more than 403.5 million accounts with total deposits exceeding Rs 1.30 lakh crore, said the Ministry of Finance of the Union.
The scheme, which has become the basis for the direct transfer of cash subsidies to the poor, was announced by Prime Minister Narendra Modi in his Independence Day address on August 15, 2014 and was launched on August 28. August of that year.
“Today, six years ago, the PMJDY was launched with the ambitious goal of banking the unbanked. This initiative has been a game changer, serving as the basis for various poverty alleviation initiatives, benefiting millions of people, ”Prime Minister Modi tweeted on Friday.
The government plans to expand the scheme to provide insurance coverage to PMJDY account holders. “Eligible PMJDY account holders will be sought to be covered by PMJJBY [Pradhan Mantri Jeevan Jyoti Bima Yojana] and PMSBY [Pradhan Mantri Suraksha Bima Yojana]. The banks have already been communicated about the same, ”he said in a statement.
The government also plans to promote digital payments, including the use of the RuPay debit card, among PMJDY account holders by creating an acceptance infrastructure across the country and providing account holders with access to microcredit and microinvestments, he added.
According to the statement, as of August 19, of all PMJDY account holders, 63.6% were in rural areas and 55.2% of the accounts belonged to women. “Thanks to PMJDY, the future of several families has become secure. A high proportion of beneficiaries are from rural areas and are women, ”the prime minister said in another tweet.
Financial inclusion is a national priority of the government, as it is an enabler for inclusive growth, the Ministry of Finance said. “It is important because it provides a way for the poor to bring their savings into the formal financial system, a way to send money to their families in the villages as well as to get them out of the clutches of usurious moneylenders,” he added.
“The PMJDY has been the cornerstone of the Modi government’s people-centered economic initiatives. Whether it is direct benefit transfers (DBT), financial assistance for coronavirus disease (Covid-19), PM-KISAN, increase in wages under the MGNREGA [Mahatma Gandhi National Rural Employment Guarantee Act, 2005], life and health insurance coverage, the first step was to provide each adult with a bank account, which the PMJDY has almost completed, ”said Finance Minister Nirmala Sitharaman.
The PMJDY became an important instrument to quickly bring relief to the poor under the Pradhan Mantri Garib Kalyan package that was announced on March 26. The package provided an amount of Rs 500 per month for three months to female PMJDY account holders.
“A total of Rs 30,705 crore has been credited to the accounts of female PMJDY account holders during April-June,” the statement said.
Additionally, around 80 million PMJDY account holders receive DBT from the government under various schemes.
The scheme involves opening basic deposit accounts at savings banks with minimal paperwork. The account opening process is simple with relaxed Know Your Customer (KYC) rules. These accounts are zero-balance, zero-charge accounts. Account holders receive indigenous debit cards with free accident insurance coverage of Rs 2 lakhs.
In August, about 86.3% (348.1 million) of accounts were operational, the statement said.
According to the Reserve Bank of India (RBI) guidelines, a PMJDY account is considered inoperative if there are no customer-induced transactions on the account for a period of two years.
Currently, these accounts have a deposit balance of Rs 1.31 lakh crore, with an average deposit of Rs 3,239 per account. The average deposit per account has multiplied by 2.5, indicating greater use of accounts and the instilling of the habit of saving among account holders, he said.
PMJDY account holders can also get help from the ‘Jan Dhan Darshak App’, a mobile app, to locate bank touch points such as bank branches, automated teller machines (ATMs), Bank Mitras and post offices, he said.
There are more than eight lakhs of banking contact points, he added.
Divakar Vijayasarathy, founder and managing partner of consulting firm DVS Advisors LLP, said that by opening nearly 17 million bank accounts in the first year under PMJDY, the government had shown its determination, but has to move on. “However, the work is half done … Other schemes like Bharatnet [rural broadband network] they must be implemented in parallel and vigorously to achieve optimal benefit. Increasing digital literacy, rural banking facilities and Internet connectivity would be crucial in this regard, ”he said.
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