Wednesday, 09 Oct, 2024
Source: Getty
With 55.6% of accounts held by women, the Pradhan Mantri Jan-Dhan Yojana (PMJDY) has transformed India’s financial ecosystem. It has made banking services accessible to nearly every adult and greatly strengthened the country’s financial infrastructure.
The Pradhan Mantri Jan-Dhan Yojana (PMJDY), now a decade old, marks a pivotal achievement in India's quest for financial inclusion. Launched to provide affordable access to banking services like savings accounts, credit, insurance, and pensions, the initiative has rapidly integrated the unbanked into the financial system. Notably, with 55.6 per cent of accounts belonging to women, it has redefined the country’s financial ecosystem, ensuring that banking services are within reach of nearly every adult and significantly bolstering India's financial framework.
As of mid-August 2024, the PMJDY has opened 53.13 crore accounts, and the average account balance has surged from Rs 1,065 in March 2015 to Rs 4,352, reflecting the scheme's growing impact. Despite no minimum balance requirement, only 8.4 per cent of accounts are at zero balance, with about 80 per cent actively used.
(Source: Finance Ministry)
The initiative has resonated most in rural and semiurban regions, where 66.6 per cent of accounts are based. Women hold 55.6 per cent of the accounts, totaling 29.56 crore. Nearly all inhabited villages—99.95 pe cent—now have banking facilities within a five-kilometre radius. As of date, India hosts over 173 crore active current and savings accounts, including more than 53 crore under PMJDY.
More significantly, deposit mobilisation under the PMJDY soared from Rs 15,600 crore in March 2015 to an impressive Rs 2.32 lakh crore by March 2024. This growth represents a compound annual growth rate (CAGR) of 30 per cent over the past decade. Additionally, the average deposit balance has consistently risen, reflecting a steady increase in savings within the accounts.
(Source: Finance Ministry)
The issuance of over 36.14 crore RuPay debit cards under the PMJDY, coupled with the rise of mobile-based payment systems like UPI, has significantly boosted digital transactions. Transactions in PMJDY accounts surged from 1,471 crore in FY18 to 11,390 crore in FY23. UPI financial transactions similarly soared from 92 crore in FY18 to 13,120 crore in FY24. Additionally, RuPay card transactions at point-of-sale (PoS) and e-commerce platforms grew from 67 crore in FY18 to 126 crore in FY23.
Approximately 6.5 crore PMJDY accountholders benefit from Direct Benefit Transfers (DBT) under various government schemes. During the COVID-19 pandemic, these accounts were pivotal in disbursing a one-time ex gratia payment of Rs 500 per month for three months (April, May, and June 2020) under the Pradhan Mantri Garib Kalyan Yojana (PMGKY), specifically targeting 20.64 crore women account holders. By March 2024, 117,701 overdraft (OD) accounts had been opened with a sanctioned credit of Rs 190 crore, with 80.5 per cent of the limit utilised. This underscores PMJDY’s role in providing access to formal credit for the most economically disadvantaged.
Prime Minister Narendra Modi called the scheme a success in a post on X (formerly Twitter). He noted, “Today, we mark a momentous occasion— #10YearsOfJanDhan. Jan Dhan Yojana has been paramount in boosting financial inclusion and giving dignity to crores of people, especially women, youth, and the marginalized communities.”
Under the Pradhan Mantri Jan-Dhan Yojana (PMJDY), individuals can open a Basic Savings Bank Deposit (BSBD) account at any bank branch or Business Correspondent (Bank Mitra) outlet.
Key Benefits of the PMJDY:
On the eve of the PMJDY’s 10th anniversary, Union Finance Minister Nirmala Sitharaman on August 27 announced that the government plans to add another 3 crore underprivileged citizens to the pool of over 53.1 crore active bank accounts in the world’s largest financial inclusion programme. The focus has shifted from targeting every household to reaching every unbanked adult in the current financial year.
According to a World Bank report, India has made remarkable progress in financial inclusion, achieving in six years what would have taken about fifty years in the past. The Jan Dhan-Aadhaar-Mobile (JAM) trinity has increased the financial inclusion rate to 80 per cent of adults from just 25 per cent in 2008. This achievement is attributed to the country's Digital Public Infrastructure (DPI). Over the past decade, India has developed one of the world's largest digital government-to-person (G2P) systems, using DPI to facilitate approximately $361 billion in transfers through 312 key schemes across 53 central government ministries.
