Seven Year of Pradhan Mantri Jan-Dhan Yojana (PMJDY)


    In News 

    • Recently, Pradhan Mantri Jan-Dhan Yojana (PMJDY) completed seven years of successful implementation

    Impact and Changes brought by PMJDY in Seven years 

    • It has produced both transformational as well as directional change thereby making the emerging  Financial Inclusion ecosystem capable of delivering financial services to the last person of the society-the poorest of the poor. 
    • It provided an avenue to the poor for bringing their savings into the formal financial system, an avenue to remit money to their families in villages besides taking them out of the clutches of the usurious money lenders. 
    • It has brought the unbanked into the banking system, expanded the financial architecture of India and brought financial inclusion to almost every adult.
    • It has been the foundation stone for people-centric economic initiatives. Whether it is direct benefit transfers, COVID-19 financial assistance, PM-KISAN, increased wages under MGNREGA, life and health insurance cover, the first step of all these initiatives is to provide every adult with a bank account, which PMJDY has nearly completed. 

    Achievements under PMJDY- As of 18th August’21

    55.47% (23.87 crores) Jan-Dhan account holders are women and 66.69% (28.70 crores) Jan Dhan accounts are in rural and semi-urban areas.

    • In August’21, out of a total of 43.04 crore PMJDY accounts, 36.86 crores (85.6%) are operative.
    • Only 8.2% of PMJDY accounts are zero balance accounts.

    About Pradhan Mantri Jan-Dhan Yojana (PMJDY) 

    • About:
      • It is National Mission for Financial Inclusion to ensure access to financial services, namely, Banking/ Savings & Deposit Accounts, Remittance, Credit, Insurance, Pension in an affordable manner.
      • It was announced by the Prime Minister in 2014.
    • Objectives: 
      • Ensure access to financial products & services at an affordable cost.
      • Financial Inclusion.
      • Use of technology to lower cost & widen reach.
    • Basic tenets of the scheme:
      •  Banking the unbanked – Opening of basic savings bank deposit (BSBD) account with minimal paperwork, relaxed KYC, e-KYC, account opening in camp mode, zero balance & zero charges
      •  Securing the unsecured – Issuance of Indigenous Debit cards for cash withdrawals & payments at merchant locations, with free accident insurance coverage of Rs. 2 lakh
      •  Funding the unfunded – Other financial products like micro-insurance, overdraft for consumption, micro-pension & micro-credit
    • Key pillars:
      • The scheme was launched based upon the following 6 pillars: 
      • Universal access to banking services  – Branch and BC
      • Basic savings bank accounts with overdraft facility of Rs. 10,000/- to every eligible adult
      • Financial Literacy Program: To Promote savings, use of ATMs, getting ready for credit, availing insurance and pensions, using basic mobile phones for banking. 
      • Creation of Credit Guarantee Fund to provide banks with some guarantee against defaults.
      • Insurance: Accident cover up to Rs. 1,00,000 and life cover of   Rs. 30,000 on the account opened between 15 Aug 2014 to 31 January 2015.
      • Pension scheme for the Unorganized sector. 
    • Extension of PMJDY with New features:
      • The Government decided to extend the comprehensive PMJDY program beyond 28.8.2018 with some modifications
      • Focus shift from ‘Every Household’ to Every Unbanked Adult’
      • RuPay Card Insurance – Free accidental insurance cover on RuPay cards increased from Rs. 1 lakh to Rs. 2 lakh for PMJDY accounts opened after 28.8.2018.
      • Enhancement in overdraft facilities –
      • OD limit doubled from Rs 5,000/- to Rs 10,000/-;  OD upto Rs 2,000/- (without conditions).
      • Increase in upper age limit for OD from 60 to 65 years

    Jan Dhan Darshak App

    • A mobile application was launched to provide a citizen-centric platform for locating banking touchpoints such as bank branches, ATMs, Bank Mitras, Post Offices, etc. in the country. 
      • Over 8 lakh banking touchpoints have been mapped on the GIS App. 
      • The facilities under Jan Dhan Darshak App could be availed as per the need and convenience of common people. 
      • This app is also being used for identifying villages that are not served by banking touchpoints within 5 km. These identified villages are then allocated to various banks by concerned SLBCs for the opening of banking outlets. 
    • Pradhan Mantri Garib Kalyan Package (PMGKP) for PMJDY women beneficiaries
      • As per the announcement made by the Hon’ble Finance Minister in 2020, under PM Garib Kalyan Yojana, an amount of Rs. 500/- per month for three months (April’20 to June’20), was credited to the accounts of women account holders under Pradhan Mantri Jan Dhan Yojana (PMJDY). 
      • A total of Rs. 30,945 crore have been credited in accounts of women PMJDY account holders during the Covid lockdown


    • Jan Dhan accounts are prone to problems of zero balance, duplication and dormancy.
    • The technological issues affecting banks from poor connectivity, networking and bandwidth problems to managing costs of maintain infrastructure especially in rural areas

    Way Forward  

    • Endeavour to ensure coverage of PMJDY account holders under micro insurance schemes. Eligible PMJDY account holders will be sought to be covered under PMJJBY and PMSBY. Banks have already been communicated about the same.
    • Promotion of digital payments including RuPay debit card usage amongst PMJDY account holders through the creation of acceptance infrastructure across India
    • Improving access of PMJDY account holders to Micro-credit and micro-investment such as Flexi-recurring deposit etc.

    What is Financial inclusion?

    • Financial inclusion may be defined as the process of ensuring access to financial services and timely and adequate credit where needed by vulnerable groups such as weaker sections and low-income groups at an affordable cost 
    • Financial Inclusion is a national priority of the Government as it is an enabler for inclusive growth. 
    • It is important as it provides an avenue to the poor for bringing their savings into the formal financial system, an avenue to remit money to their families in villages besides taking them out of the clutches of the usurious money lenders. 

    Source: PIB