Financial Inclusion and PMJDY

 Introduction
Any kind of government services is considered as public goods and availability of such goods
to the entire population is the main objective of any Public policy. When we specifically talk
about banking services or financial services the term “Financial Inclusion” comes in.
Scenario in India
India after 71 years of independence is still unable to bring all of its citizens under the formal
banking system.

The government, Reserve Bank of India have been making efforts to promote financial
inclusion as one of the national objective of the country. But still a report claims that more
than 19 crore people do not have any bank account even after the ambitious and successful
launch of Pradhan Mantri Jan Dhan Yojana. Apart from that, the new launch of the Indian
Postal Payment Bank, building robust branch networks of scheduled commercial banks, co-
operative banks, and Regional rural bank could not make any difference. Most of the people
in the rural area where this deprivation is mostly seen, could not figure out the necessity of
presence of formal sector.
Financial Inclusion protects the financial wealth a person might have and mitigates the
mistreatments of vulnerable sections by the extortionate money lenders by providing easy
access to loans.

 Objectives
 To understand present status of financial inclusion in the country.
 To study the Pradhan Mantri Jan Dhan Yojna (PMJDY) performance& Challenges.

 Survey of Literature
N. Swati in his “A Study On Pradhan Mantri Jan Dhan Yojana (Pmjdy) In Uttara Kannada
District, Karnataka” focuses on the analysing different schemes in financial inclusion and
socio-economic profile of the PMJDY account holders and analyse the problems faced by
banks.
Rajat Deb and Prasnejit Das in their study focuses on “Perceptions Of Bank Account Holders
About PMJDY – A Study On Baikhora Region Of South Tripura “.

PRADHAN MANTRI JAN DHAN YOJANA (PMJDY):

Pradhan Mantri Jan Dhan Yojana (PMJDY), is financial inclusion program of Government of
India that aims to expand and make affordable access to financial services such as bank
accounts, remittances, credit, insurance and pensions without any kind of discrimination.
This inclusion campaign was launched by the Prime Minister of India Narendra Modi on 15
August 2014. He had announced this scheme on his first Independence Day speech on 15
August 2014.

The Main Benefits:

 Accidental and Life insurance coverage.
 No minimum balance required.
 Loan and Mobile banking facility.
 Interest on Deposits.

Facts and Figures:

AS we can see that after the launch of PMJDY 12 crore accounts were opened in both rural as
well as in urban areas.

No of Accounts opened under PMJDY as on 31.01.2015 (Summary)

No Of Balance In
Rural Urban No Of Accounts
RuPay Accounts(In Lacs)
Debit Card

Public Sector Bank 53300249 45147276 98447525 91232024 817463.04

Rural Regional Bank 18489448 3297833 21787281 14967614 159948.08

Private Banks 3226397 2012086 5238483 4593161 72551.50

Grand Total 75016094 50457195 125473289 110792799 1049962.62

(Source: https://www.pmjdy.gov.in/files/progress/phase1.pdf)

As on 12th September 2018 about 32 crore bank accounts were opened under this PMJDY
scheme. Amongst the Public sector banks State Bank of India had opened 31.267% of total
accounts making Punjab National Bank in second position with 11.19% new accounts. And
Bank of Baroda is in the third position with 7.156% of new accounts opened in public sector
banks.
Bank Type Number of Number of Number of Deposits in Number of RuPay
Beneficiaries Beneficiaries Total Accounts Debit Cards issued
at rural/semi at urban metro Beneficiaries (In lac) to beneficiaries
urban centre centre bank
bank branches branches
Public Sector 142009599 121612557 263622156 6526974.50 199381469
Banks
Regional 44914766 8228437 53143203 1453772.74 37034034
Rural Banks
Private Sector 6052309 3974380 10026689 219886.22 9303167
Banks
Grand Total 192976674 133815374 326792048 8200633.46 245718670

(Source: https://www.pmjdy.gov.in/BankwiseLatest)

One day after the announcement of demonetization on November 8, 2016, the cumulative
Balance in about 25 crore accounts was about Rs. 45,600 crore. But post demonetization, that
figure has gone up. While the final word is yet to be said on the alleged channelling of black
money into Jan Dhan accounts, the scheme has indeed led to a Transformation.

A total of 240 million RuPay cards have been issued by National Payments Corporation of
India. There is a data which depicts the current status of PMJDY statics as on 12th September
2018:

Bank Name / Type Deposits in Accounts Number of RuPay Debit

(In lac) Cards issued to
beneficiaries
Public Sector Banks 6526974.50 199381469
Regional Rural Banks 1453772 37034034
Private Sector Banks 219886.22 9303167
Grand Total 8200633.46 245718670

Progress Report:

The statistics shows the progress of number of accounts open in PMJDY, in all the three
banks i.e. Public Sector Banks, Regional Rural Banks and Private Sector Banks. The
diagrams clearly shows an increase in the number of accounts.
 2015 2018
60000000 160000000
140000000
50000000
120000000
40000000 100000000
80000000
30000000
60000000
20000000 40000000
20000000
10000000
0
0 Public Rural Private
Public Sector Bank Rural Regional Private Banks Sector Regional Sector
Bank Banks Bank Banks

Rural Urban Rural Urban

Conclusion:
Success of the PMJDY scheme depends on the effective regulatory system and
successful implementation of the programme. The challenge is the conversion of the non-
operative accounts with zero balance into operative and for this it’s important to focus on
financial literacy programme. “Mera Khata – Bhagya Vidhaata.” is the slogan of this
scheme. The PMJDY scheme has created an impressive result in the banking sector with
regard to eradication of financial untouchability in the country. Mere opening of bank
accounts may not fulfil the aim of the scheme, but there should be continuous operation
of bank accounts to give the real success of the scheme.

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