Context: According to the data presented by the Finance Ministry, over 13 crore Jan Dhan Accounts, i.e., 23% of the total 56 crore opened till July 31, 2025 are inoperative. The amount parked in these accounts stands at over ₹2.64 lakh crore.
Under Reserve Bank of India norms, a savings account is classified as inoperative/dormant if no transactions are recorded for over two years.
Relevance of the topic:
Prelims: Key facts about Pradhan Mantri Jan Dhan Yojana.
Mains: Govt. initiatives towards financial inclusion.
What is financial inclusion?
Financial Inclusion refers to universal access to a wide range of financial services at an affordable cost. These include not only banking products (basic savings, deposit accounts, remittance and credit) but also other financial services such as insurance, pension and equity products.
What are the benefits of financial inclusion?
- Efficient Mobilization of Resources: When more people come under the banking sector, it leads to increased deposits, allowing for easier mobilization of resources for investment and productive purposes.
- Poverty Alleviation: Access to formal credit and financial services enables poor households to access cheaper credit, which can help in their economic empowerment. It also prevents them from falling into debt traps, which are often associated with informal or exploitative lending practices.
- Formalization of the Economy: Financial inclusion helps bring more individuals and businesses into the formal financial sector. This can lead to better regulation and tax compliance.
As per census 2011, only 58% of households are availing banking services in the country.
PM Jan-Dhan Yojana
Pradhan Mantri Jan-Dhan Yojana (PMJDY) was launched to improve financial inclusion. Under the scheme, a basic savings bank deposit account can be opened in any bank branch or Business Correspondent (Bank Mitra) outlet, by persons not having any other account.
Benefits under PMJDY
- One basic savings bank account is opened for unbanked person.
- There is no requirement to maintain any minimum balance in PMJDY accounts.
- Interest is earned on the deposit in PMJDY accounts.
- Rupay Debit card is provided to PMJDY account holder.
- Accident Insurance Cover of Rs.2 lakh is available.
- An overdraft (OD) facility up to Rs. 10,000 to eligible account holders is available.
- PMJDY accounts are eligible for all the Direct Benefit Transfer (DBT) schemes MUDRA scheme.
Impact of PMJDY
The Pradhan Mantri Jan Dhan Yojana (PMJDY) has been widely regarded as a successful and transformative financial inclusion program in India. Here's an assessment of the key achievements and impact of the PMJDY:
- Expansion of Banking Access: The scheme significantly increased the number of bank account holders, especially in the unbanked and underbanked segments of the population. As on July 31, 2024, there are 52.99 crore total beneficiaries (account-holders) with total account balance of more than ₹2 lakh crore.
- Direct Benefit Transfers: The PMJDY has enabled the direct transfer of government benefits, subsidies, and welfare payments directly into the beneficiaries' bank accounts. This has improved the targeting and delivery of government schemes, reducing leakages and improving transparency.
- Women's Financial Inclusion: The PMJDY has a specific focus on promoting women's financial inclusion, with over 55% of the Jan Dhan accounts being held by women.
- Financial Literacy and Awareness: The PMJDY has incorporated financial literacy and awareness campaigns to educate the beneficiaries on the use of their bank accounts and various financial services.