30-Jun-2023: Public Sector Banks and eligible Private Sector Banks authorised to implement and operationalise Mahila Samman Savings Certificate, 2023

The Department of Economic Affairs, Ministry of Finance, through an e-gazette notification issued on June 27, 2023, permitted all Public Sector Banks and eligible Private Sector Banks to implement and operationalise the Mahila Samman Savings Certificate, 2023. This aims at enabling enhanced access of the scheme for girls/women. With this, Mahila Samman Savings Certificate scheme will now be available for subscription in Post Offices, and eligible Scheduled Banks.

The scheme has been in operation since April 1, 2023 through the Department of Post.

The Central Government has made a number of efforts to secure the political, social, and economic advancement of women through a variety of planned initiatives. In continuation of these efforts, Mahila Samman Savings Certificate, 2023 scheme was announced in the Union Budget FY 2023-24 by the Central Government to provide financial security to every girl and woman in India.

Key Features of the Scheme.

  • Provides attractive and secured investment option to all girls and women
  • An account can be opened under this scheme on or before the March 31, 2025 for a tenure of two years
  • The deposit made under MSSC will bear interest at the rate of 7.5% per annum which will be compounded quarterly. Therefore, the effective interest rate will be roughly 7.7 percent.
  • Minimum of ₹1000 and any sum in multiple of 100 may be deposited within the maximum limit of ₹200,000.
  • Maturity of the investment under this scheme is two years from the date of opening of the account under the scheme.
  • It envisions flexibility not only in investment but also in partial withdrawal during the scheme tenor. The account holder is eligible to withdraw maximum up to 40% of the eligible balance in the scheme account.

8-Apr-2023: More than 40.82 crore loans amounting to ₹23.2 lakh crore sanctioned under Pradhan Mantri MUDRA Yojana (PMMY) since inception

The Pradhan Mantri MUDRA Yojana (PMMY) was launched on 8th April 2015 by Prime Minister Shri Narendra Modi with the aim to facilitate easy collateral-free micro credit of up to ₹10 lakh to non-corporate, non-farm small and micro entrepreneurs for income generating activities. The loans under PMMY are provided by Member Lending Institutions (MLIs), i.e., Banks, Non-Banking Financial Companies (NBFCs), Micro Finance Institutions (MFIs) and other financial intermediaries.

Upon marking successful 8th anniversary of the PMMY, Union Minister for Finance & Corporate Affairs Smt. Nirmala Sitharaman said, “Brought under the visionary leadership of Prime Minister Shri Narendra Modi, the scheme has enabled easy and hassle-free access to credit to micro-enterprises and has helped a large number of young entrepreneurs establish their businesses."

In reference to the PMMY data, Smt. Sitharaman said, “Since the launch of the scheme, as of 24.03.2023, about ₹23.2 lakh crore has been sanctioned in 40.82 crore loan accounts. About 68% of accounts under the scheme belong to women entrepreneurs and 51% of accounts belong to entrepreneurs of SC/ST and OBC categories. This demonstrates that easy availability of credit to the budding entrepreneurs of the country has led to innovation and sustained increase in per capita income.”

28-Aug-2022: Pradhan Mantri Jan Dhan Yojana (PMJDY) - National Mission for Financial Inclusion, completes eight years of successful implementation

The Ministry of Finance, through its financial inclusion led interventions, is committed to provide financial inclusiveness and support to the marginalised and hitherto socio-economically neglected classes. Through Financial Inclusion (FI) we can achieve equitable and inclusive growth of the nation. Financial Inclusion stands for delivery of appropriate financial services at an affordable cost, on timely basis to vulnerable groups such as low-income groups and weaker sections who lack access to even the most basic banking services.

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. A key initiative towards this commitment is the Pradhan Mantri Jan Dhan Yojna (PMJDY), which is one of the biggest financial inclusion initiatives in the world.

PMJDY was announced by Prime Minister, Shri Narendra Modi in his Independence Day address on 15th August 2014. While launching the programme on 28th August, the Prime Minister had described the occasion as a festival to celebrate the liberation of the poor from a vicious cycle.

On the occasion 8th Anniversary of PMJDY, Union Finance Minister Smt. Nirmala Sitharaman in her message said that. “Financial inclusion is a major step towards inclusive growth which ensures the overall economic development of the marginalised sections of the society. The success of the PMJDY since August 28, 2014 is reflected in terms of opening of over 46 crore bank accounts with deposit balance of Rs 1.74 lakh crore with its expanded coverage to 67% rural or semi-urban areas as well as 56% of women Jan Dhan account holders. Continuation of PMJDY beyond 2018 saw a marked shift in approach to meet challenges and requirements of emerging FI landscape in the country. There has been a shift in focus from “every household’ to “every adult”, with added emphasis on usage of accounts by enhancing Direct Benefit Transfer (DBT) flows through these accounts, promoting digital payments through the use of RuPay cards, etc., She added.”

“The underlying pillars of PMJDY, namely, Banking the Unbanked, Securing the Unsecured and Funding the Unfunded has made it possible to adopt multi-stakeholders’ collaborative approach while leveraging technology for serving the unserved and underserved areas as well,” the Finance Minister said.

The Finance Minister further stated in her message that, “The JAM pipeline created through account holders’ consent-based linking of bank accounts with Aadhar and mobile numbers of the account holders, which is one of the important pillars of FI ecosystem, has enabled instant DBT under various government welfare schemes to the eligible beneficiaries. The advantage of the architecture created under FI ecosystem came handy during the Covid-19 pandemic when it facilitated direct income support to farmers under PM-KISAN and transfer of ex-gratia payment to women PMJDY account holders under PMGKP in a seamless and time-bound manner.

Smt. Sitharaman concluded her message and said, “Financial Inclusion needs policy-led intervention based on an architecture linked to suitable financial products, information and communication technologies and data infrastructure. The country has adopted this strategy since the launch of PMJDY to optimise the intended benefits of the scheme for the people of the country. I thank all the field functionaries for their untiring efforts in making PMJDY a grand success.

Expressing his thoughts for PMJDY on this occasion, Union Minister of State for Finance Dr. Bhagwat Karad said, “Pradhan Mantri Jan Dhan Yojana (PMJDY) has been one of the most far reaching initiatives towards Financial Inclusion not only in India but in the world. Financial Inclusion is among top-most priorities of the Government as it is an enabler for inclusive growth. It provides an avenue to the poor for bringing their savings into the formal financial system, an avenue to remit money to their families besides taking them out of the clutches of the usurious money lenders.”

Dr Karad said, “On the 8th Anniversary of PMJDY, the importance of this Scheme is reiterated. PMJDY has become the foundation stone for the government's 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 is to provide every adult with a bank account, which PMJDY has nearly completed.”

“I am confident that banks will rise to the occasion and contribute to this national endeavour in significant measure and re-dedicate your selves to ensure that each and every adult is covered under the Financial Inclusion initiatives of the government,” Dr Karad said.

As we complete 8 years of successful implementation of this Scheme, we take a look at the major aspects and achievements of this Scheme so far.

Background: Pradhan Mantri Jan Dhan Yojana (PMJDY) 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.

  1. Objectives:
    1. Ensure access of financial products & services at an affordable cost
    2. Use of technology to lower cost & widen reach
  2. Basic tenets of the scheme
    1. 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
    2. Securing the unsecured - Issuance of Indigenous Debit cards for cash withdrawals & payments at merchant locations, with free accident insurance coverage of Rs. 2 lakh
    3. Funding the unfunded - Other financial products like micro-insurance, overdraft for consumption, micro-pension & micro-credit

Initial Features

The scheme was launched based upon the following 6 pillars:

  1. Universal access to banking services  – Branch and BC
  2. Basic savings bank accounts with overdraft facility of Rs. 10,000/- to every eligible adult
  3. Financial Literacy Programme– Promoting savings, use of ATMs, getting ready for credit, availing insurance and pensions, using basic mobile phones for banking
  4. Creation of Credit Guarantee Fund – To provide banks some guarantee against defaults
  5. Insurance – Accident cover up to Rs. 1,00,000 and life cover of   Rs. 30,000 on account opened between 15 Aug 2014 to 31 January 2015
  6. Pension scheme for Unorganized sector

Important approach adopted in PMJDY based on past experience:

  • Accounts opened are online accounts in core banking system of banks, in place of earlier method of offline accounts opening with technology lock-in with the vendor
  • Inter-operability through RuPay debit card or Aadhaar enabled Payment System (AePS)
  • Fixed-point Business Correspondents
  • Simplified KYC / e-KYC in place of cumbersome KYC formalities

Extension of PMJDY with New features – The Government decided to extend the comprehensive PMJDY programme 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

Impact of PMJDY

PMJDY 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.

One in 2 accounts opened between Mar’14 to Mar’20 was a PMJDY account. Within 10 days of nationwide lockdown more than about 20 crore women PMJDY accounts were credited with ex-gratia.

Jan Dhan 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. PMJDY has brought the unbanked into the banking system, expanded the financial architecture of India and brought financial inclusion to almost every adult.

In today's COVID-19 times, we have witnessed the remarkable swiftness and seamlessness with which Direct Benefit Transfer (DBTs) have empowered and provided financial security to the vulnerable sections of society. An important aspect is that DBTs via PM Jan Dhan accounts have ensured every rupee reaches its intended beneficiary and preventing systemic leakage.

Achievements under PMJDY- As on 10th August’22:

  1. PMJDY Accounts
    • As on 10th August ’22 number of total PMJDY Accounts: 46.25 crore; 55.59% (25.71 crore) Jan-Dhan account holders are women and 66.79% (30.89 crore) Jan Dhan accounts are in rural and semi-urban areas
    • During first year of scheme 17.90 crore PMJDY accounts were opened
    • Continuous increase in no of accounts under PMJDY
    • PMJDY Accounts have grown three-fold from 14.72 crore in Mar’15 to 46.25 crore as on 10-08-2022. Undoubtedly a remarkable journey for the Financial Inclusion Programme.

Operative PMJDY Accounts –

  • As per extant RBI guidelines, a PMJDY account is treated as inoperative if there are no customer induced transactions in the account for over a period of two years
  • In August’22, out of total 46.25 crore PMJDY accounts, 37.57 crore (81.2%) are operative
  • Only 8.2% PMJDY accounts are zero balance accounts

Deposits under PMJDY accounts –

  • Total deposit balances under PMJDY Accounts stand at Rs. 1,73,954 crore
  • Deposits have increased about 7.60 times with increase in accounts 2.58 times (Aug’22 / Aug’15)

Average Deposit per PMJDY account –

  • Average deposit per account is Rs. 3,761
  • Avg. Deposit per account has increased over 2.9 times over Aug’15
  • Increase in average deposit is another indication of increased usage of accounts and inculcation of saving habit among account holders.

Rupay Card issued to PMJDY account holders

  • Total RuPay cards issued to PMJDY accountholders: 31.94 crore
  • Number of RuPay cards & their usage has increased over time

Jan Dhan Darshak App

A mobile application, was launched to provide a citizen centric platform for locating banking touch points 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. The web version of this application could be accessed at the link http://findmybank.gov.in.

This app is also being used for identifying villages which are not served by banking touchpoints within 5 km. these identified villages are then allocated to various banks by concerned SLBCs for opening of banking outlets. The efforts have resulted in significant decrease in number of such villages.

Towards ensuring smooth DBT transactions

As informed by banks, about 5.4 crore PMJDY accountholders receive direct benefit transfer (DBT) from the Government under various schemes. To ensure that the eligible beneficiaries receive their DBT in time, the Department takes active role in identification of avoidable reasons for DBT failures in consultation with DBT Mission, NPCI, banks and various other Ministries. With close monitoring in this regard through regular VCs with banks and NPCI, the share of DBT failures due to avoidable reasons as a percentage of total DBT failures has decreased from 13.5%  (FY 19-20) to 9.7% (FY 21-22).

Digital transactions: With the issue of over 31.94 crore RuPay debit cards under PMJDY, installation of 61.69 lakh PoS/mPoS machines as on June’22 and the introduction of mobile based payment systems like UPI, the total number of digital transactions have gone up from 978 crore in FY 2016-17 to 7,195 crore in FY 2021-22.  The total number of UPI financial transactions have increased from 1.79 crore in FY 2016-17 to 4,596 crore in FY 2021-22. Similarly, total number of RuPay card transactions at PoS and E-commerce have increased from 28.28 crore in FY 2016-17 to 151.64 crore in FY 2021-22.

The road ahead

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

2-Sep-2021: PMJDY has Reached the Remotest and Hilly Areas Benefitting all Sections of the Society, Opine Experts

The actual journey of financial inclusion in India started in 2014 when the Pradhan Mantri Jan Dhan Yojana (PMJDY) and other related schemes were started, said Shri Sushanta Kumar Sahoo, DGM, State Bank of India, Guwahati while addressing a webinar organized on the occasion of the 7th anniversary of the launch of Pradhan Mantri Jan Dhan Yojana. The webinar was organized by Press Information Bureau, Guwahati today.

Talking about financial inclusion Shri Sahoo said that financial inclusion mainly provides reliable financial solution to the economically weaker section of the society through various financial products relating to credit, investment, insurance and pension. He informed that a record number of bank accounts were opened under PMJDY scheme in Assam. As on June, 2021 the State has 1 Crore 90 Lakh PMJDY accounts against 50 lakh households, he said.  He also highlighted about the success of other schemes like PM Jeevan Jyoti Beema Yojana and Atal Pension Yojana in his address.

Shri Sahoo requested all the stakeholders like the government functionaries at the different district and block level and also the NGOs to participate in this programme  in  good manner so that the financial inclusion programme can reach  the lowest section of the people   and this movement can go on successfully.

Addressing the webinar, Smt Kuhu Ganguli, DGM, State Bank of India, LHM, Kolkata informed that in Sikkim 86 thousand Jan Dhan accounts have been opened till date. Asserting it as a big achievement she said that the benefits of Jan Dhan Yojana have reached the remotest and hilly areas benefitting all section of people.

Prof S. S. Mahapatra, HoD, Commerce, Sikkim Central university spoke on Financial inclusion and economic development in the country in reference of PMJDY. He said that within a short span of seven years India has seen many changes and the financial inclusion ecosystem has become stronger and now it is capable of delivering financial services to the poorest of the poor. Shri Mahapatra added that during Covid-19 Atmanirbhar package led people to view Jan  Dhan  as the channel for all welfare schemes.

Shri Ravi Shankar Ravi, Editor Dainik Purvoday opined that opening a bank account is now not difficult for the lower strata of population in our country because of PMJDY. Under this scheme the Government has granted access to those who have difficulties opening accounts in banks.

Shri Gopajit Das, Media and Communication Officer, PIB delivered the welcome address and the webinar was moderated by Smt. Sucharita Sahoo, Media and Communication Officer, PIB, Guwahati. Participants from across Northeast region, field offices of Press Information Bureau & Regional Outreach Bureau joined the webinar today.

28-Aug-2021: Pradhan Mantri Jan-Dhan Yojana (PMJDY) - National Mission for Financial Inclusion, completes seven years of successful implementation

Ministry of Finance is committed to provide financial inclusiveness and support to the marginalized and hitherto socio-economically neglected classes. 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. A key initiative towards this commitment is the Pradhan Mantri Jan Dhan Yojna (PMJDY), which is one of the biggest financial inclusion initiatives in the world.

PMJDY was announced by Prime Minister, Shri Narendra Modi in his Independence Day address on 15th August 2014. While launching the programme on 28th August, the Prime Minister had described the occasion as a festival to celebrate the liberation of the poor from a vicious cycle.

On the 7th Anniversary of PMJDY, Finance Minister Smt. Nirmala Sitharaman reiterated the importance of this Scheme “The journey of PMJDY led interventions undertaken over a short span of 7 years has in effect, produced both transformational as well as directional change thereby making the emerging FI ecosystem capable of delivering financial services to the last person of the society-the poorest of the poor. The underlying pillars of PMJDY, namely, Banking the Unbanked, Securing the Unsecured and Funding the Unfunded has made it possible to adopt multi-stakeholders’ collaborative approach while leveraging technology for serving the unserved and underserved areas as well.” she said

Minister of State for Finance, Dr. Bhagwat Karad also expressed his thoughts for PMJDY on this occasion. He said “Pradhan Mantri Jan Dhan Yojana (PMJDY) has been one of the most far reaching initiatives towards Financial Inclusion not only in India but in the world. Financial Inclusion is among top-most priorities of the Government as it is an enabler for inclusive growth. It provides an avenue to the poor for bringing their savings into the formal financial system, an avenue to remit money to their families besides taking them out of the clutches of the usurious money lenders.”

As we complete 7 years of successful implementation of this Scheme, we take a look at the major aspects and achievements of this Scheme so far.

Background: Pradhan Mantri Jan-Dhan Yojana (PMJDY) 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.

Objectives:

  • Ensure access of financial products & services at an affordable cost
  • 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

Initial Features: 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– Promoting 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 some guarantee against defaults
  • Insurance – Accident cover up to Rs. 1,00,000 and life cover of   Rs. 30,000 on account opened between 15 Aug 2014 to 31 January 2015
  • Pension scheme for Unorganized sector

Important approach adopted in PMJDY based on past experience:

  • Accounts opened are online accounts in core banking system of banks, in place of earlier method of offline accounts opening with technology lock-in with the vendor
  • Inter-operability through RuPay debit card or Aadhaar enabled Payment System (AePS)
  • Fixed-point Business Correspondents
  • Simplified KYC / e-KYC in place of cumbersome KYC formalities

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

Impact of PMJDY

PMJDY 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.

One in 2 accounts opened between Mar’14 to Mar’20 was a PMJDY account. Within 10 days of nationwide lockdown more than about 20 crore women PMJDY accounts were credited with ex-gratia.

Jandhan 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. PMJDY has brought the unbanked into the banking system, expanded the financial architecture of India and brought financial inclusion to almost every adult.

In today's COVID-19 times, we have witnessed the remarkable swiftness and seamlessness with which Direct Benefit Transfer (DBTs) have empowered and provided financial security to the vulnerable sections of society. An important aspect is that DBTs via PM Jan Dhan accounts have ensured every rupee reaches its intended beneficiary and preventing systemic leakage.

Achievements under PMJDY- As on 18th August’21:

PMJDY Accounts

  • As on 18th August ’21 number of total PMJDY Accounts: 43.04 Crore; 55.47% (23.87 crore) Jan-Dhan account holders are women and 66.69% (28.70 crore) Jan Dhan accounts are in rural and semi-urban areas
  • During first year of scheme 17.90 crore PMJDY accounts were opened
  • Continuous increase in no of accounts under PMJDY
  • PMJDY Accounts have grown three-fold from 14.72 Crore in Mar’15 to 43.04 Crore as on 18-08-2021. Undoubtedly a remarkable journey for the Financial Inclusion Program.

Operative PMJDY Accounts

  • As per extant RBI guidelines, a PMJDY account is treated as inoperative if there are no customer induced transactions in the account for over a period of two years
  • In August’21, out of total 43.04 crore PMJDY accounts, 36.86 crore (85.6%) are operative
  • Continuous increase in % of operative accounts is an indication that more and more of these accounts are being used by customers on a regular basis
  • Only 8.2% PMJDY accounts are zero balance accounts

Deposits under PMJDY accounts -

  • Total deposit balances under PMJDY Accounts stand at Rs. 1,46,230 crore
  • Deposits have increased about 6.38 times with increase in accounts 2.4 times (Aug’21 / Aug’15)

Average Deposit per PMJDY account -

  • Average deposit per account is Rs. 3,398
  • Avg. Deposit per account has increased over 2.7 times over Aug’15
  • Increase in average deposit is another indication of increased usage of accounts and inculcation of saving habit among account holders

RuPay Card issued to PMJDY account holders

  • Total RuPay cards issued to PMJDY accountholders: 31.23 Crore
  • Number of RuPay cards & their usage has increased over time

Jan Dhan Darshak App

A mobile application, was launched to provide a citizen centric platform for locating banking touch points 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. The web version of this application could be accessed at the link http://findmybank.gov.in.

This app is also being used for identifying villages which are not served by banking touchpoints within 5 km. these identified villages are then allocated to various banks by concerned SLBCs for opening of banking outlets. The efforts have resulted in significant decrease in number of such villages.

Pradhan Mantri Garib Kalyan Package (PMGKP) for PMJDY women beneficiaries

As per announcement made by the Hon’ble Finance Minister on 26.3.2020, 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 Covid lockdown

Towards ensuring smooth DBT transactions:

As informed by banks, about 5 crore PMJDY accountholders receive direct benefit transfer (DBT) from the Government under various schemes. To ensure that the eligible beneficiaries receive their DBT in time, the Department takes active role in identification of avoidable reasons for DBT failures in consultation with DBT Mission, NPCI, banks and various other Ministries. With close monitoring in this regard through regular VCs with banks and NPCI, the share of DBT failures due to avoidable reasons as a percentage of total DBT failures has decreased from 13.5%  (FY 19-20) to 5.7% (FY 20-21).

The road ahead

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

8-Feb-2021: 41.75 accounts opened under Pradhan Mantri Jan Dhan Yojana

As reported by Public Sector Banks (PSBs) [including sponsored Regional Rural Banks (RRBs)] and 14 major Private Sector Banks, as on 27.01.2021, a total number of 41.75 crore accounts have been opened under Pradhan Mantri Jan Dhan Yojana (PMJDY) out of which 35.96 crore accounts are operative.

Under the Pradhan Mantri Jan-Dhan Yojana (PMJDY) a bank account can be opened with any bank branch or Business Correspondent (BC) including those of Private Sector Banks.

The total number of PMJDY accounts opened by PSBs (including sponsored RRBs) and 14 major Private Sector Banks are 40.48 crore and 1.27 crore respectively.

Accounts opened under PMJDY are Basic Savings Bank Deposit (BSBD) accounts. As per RBI guidelines dated 10.06.2019, banks are required to offer the following minimum banking facilities, free of charge, to the BSBD account holders, without any requirement of minimum balance:

  • Deposit of cash at bank branch as well as ATMs/CDMs
  • Receipt/ credit of money through any electronic channel or by means of deposit /collection of cheques drawn by Central/State Government agencies and departments
  • No limit on number and value of deposits that can be made in a month
  • Minimum of four withdrawals in a month, including ATM withdrawals
  • ATM Card or ATM-cum-Debit Card

28-Aug-2020: Pradhan Mantri Jan-Dhan Yojana (PMJDY) - National Mission for Financial Inclusion, completes six years of successful implementation

Ministry of Finance is committed to provide financial inclusiveness and support to the marginalized and hitherto socio-economically neglected classes. 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. A key initiative towards this commitment is the Pradhan Mantri Jan Dhan Yojna (PMJDY), which is one of the biggest financial inclusion initiatives in the world.

PMJDY was announced by Prime Minister, Shri Narendra Modi in his Independence Day address on 15th August 2014. While launching the programme on 28th August, the Prime Minister had described the occasion as a festival to celebrate the liberation of the poor from a vicious cycle.

On the 6th Anniversary of PMJDY, Union Minister for Finance & Corporate Affairs , Smt. Nirmala Sitharaman reiterated the importance of this Scheme “The Pradhan Mantri Jan Dhan Yojana has been the foundation stone for the Modi government’s 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 was to provide every adult with a bank account, which PMJDY has nearly completed.” she said

Minister of State for Finance & Corporate Affairs, Shri Anurag thakur also expressed his thoughts for PMJDY on this occasion. He said “Under the leadership of Prime Minister Narendra Modi, PMJDY has brought the unbanked into the banking system, expanded the financial architecture of India and brought financial inclusion to over 40 crore account holders. A majority of the beneficiaries are women and most of the accounts are from rural India. In today’s COVID19 times, we have witnessed the remarkable swiftness and seamlessness with which DBTs have empowered and provided financial security to the vulnerable sections of society. An important aspect is that DBTs via PM Jan Dhan accounts have ensured every rupee reaches its intended beneficiary and prevented systemic leakage.”

As we complete 6 years of successful implementation of this Scheme, we take a look at the major aspects and achievements of this Scheme so far.

Background

Pradhan Mantri Jan-Dhan Yojana (PMJDY) 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.

  1. Objectives:
    • Ensure access of financial products & services at an affordable cost
    • Use of technology to lower cost & widen reach
  2. 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.
  1. Initial Features

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 household
  • Financial Literacy Program– Promoting 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 some guarantee against defaults
  • Insurance – Accident cover up to Rs. 1,00,000 and life cover of   Rs. 30,000 on account opened between 15 Aug 2014 to 31 January 2015
  • Pension scheme for Unorganized sector
  1. Important approach adopted in PMJDY based on past experience:
    • Accounts opened are online accounts in core banking system of banks, in place of earlier method of offline accounts opening with technology lock-in with the vendor
    • Inter-operability through RuPay debit card or Aadhaar enabled Payment System (AePS)
    • Fixed-point Business Correspondents
    • Simplified KYC / e-KYC in place of cumbersome KYC formalities
  2. 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
  3. Achievements under PMJDY- As on 19th Aug’2020:
    1. PMJDY Accounts
      1. As on 19th Aug’20 Number of Total PMJDY Accounts: 40.35 Crore; Rural PMJDY accounts: 63.6%, Women PMJDY accounts: 55.2%.
      2. During first year of scheme 17.90 crore PMJDY accounts were opened.
      3. Continuous increase in no of accounts under PMJDY.
    2. Operative PMJDY Accounts –
      1. As per extant RBI guidelines, a PMJDY account is treated as inoperative if there are no customer induced transactions in the account for over a period of two years
      2. In Aug’20, out of total 40.35 crore PMJDY accounts, 34.81 crore (86.3%) are operative.
      3. Continuous increase in % of operative accounts is an indication that more and more of these accounts are being used by customers on a regular basis.
    3. Deposits under PMJDY accounts -
      1. Total deposit balances under PMJDY Accounts stand at Rs. 1.31 lakh crore.
      2. Deposits have increased about 5.7 times with increase in accounts 2.3 times (Aug’20 / Aug’15).
    4. Average Deposit per PMJDY account -
      1. Average deposit per account is Rs. 3239
      2. Avg. Deposit per account has increased over 2.5 times over Aug’15
      3. Increase in average deposit is another indication of increased usage of accounts and inculcation of saving habit among account holders
      4. RuPay Card issued to PMJDY account holders
      5. Total RuPay cards issued to PMJDY accountholders: 29.75 Crore
      6. Number of RuPay cards & their usage has increased over time
  4. Jan Dhan Darshak App

A mobile application, was launched to provide a citizen centric platform for locating banking touch points 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. The web version of this application could be accessed at the link http://findmybank.gov.in.

This app is also being used for identifying villages which are not served by banking touchpoints within 5 km. these identified villages are then allocated to various banks by concerned SLBCs for opening of banking outlets. The efforts have resulted in significant decrease in number of such villages.

  1. Pradhan Mantri Garib Kalyan Package (PMGKP) for PMJDY women beneficiaries

As per announcement made by the Hon’ble Finance Minister on 26.3.2020, 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. 30,705 crore have been credited in accounts of women PMJDY account holders during April-June, 2020.

  1. Towards ensuring smooth DBT transactions:  

As informed by banks, about 8 crore PMJDY accountholders receive direct benefit transfer (DBT) from the Government under various schemes. To ensure that the eligible beneficiaries receive their DBT in time, the Department takes active role in identification of avoidable reasons for DBT failures in consultation with DBT Mission, NPCI, banks and various other Ministries. With close monitoring in this regard through regular VCs with banks and NPCI, the number of DBT failure due to avoidable reasons has observed significant decline from 5.23 lakh (0.20%) in Apr’19 to 1.1 lakh (0.04%) in Jun’20. 

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

13-Apr-2020: SHG women working as Business Correspondents for banks (BC Sakhis)

COVID – 19 pandemic has resulted in a national lockdown leaving a large number of people without access to wages and employment. Those worst hit by this unprecedented pandemic and lockdown are daily wage labourers, migrants, homeless, the poor and many who form the floating population. The Union Government had announced release of 500/- per month for 3 months in 20.39 Crore Women PMJDY accounts. Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM), Ministry of Rural Development was given responsibility to transfer the fund with support of Department of Financial Services and Banks. Government of India also released other DBT funds like Rs.2000/- to PM Kisan Yojana accounts, MGNREGA wages payments to all rural population to address the financial stress being faced by the community.

Due to release of DBT funds, there was expected rush at Bank premises for withdrawal of the amount. The instructions regarding withdrawal were already given in advance by many Banks as to how and who can come to the Bank for withdrawal as per last digit of account numbers. In most of the cases, the services of BC Sakhis (SHG women working as Business Correspondents for banks) were utilized for making payments to the rural households.

All banks understood the importance of BC Sakhi and Bank Sakhi and issued special ID cards for Covid-19 Lockdown Pass as Essential Service Duty. They were issued letters from the Banks and stickers/passes by local administration. They were asked to take due care in view of Covid-19 pandemic like hand sanitizer, social distancing, masks etc.

As a result, out of around 8800 BC Sakhi and 21600 Bank Sakhi, around 50% of both cadre voluntarily started working amidst Lockdown across the country right from Assam, Mizoram, Sikkim, Manipur to Bihar, Jharkhand, Chhattisgarh, Madhya Pradesh, Odisha, West Bengal, Gujarat, Maharashtra, Rajasthan, Punjab, Uttar Pradesh & Tamil Nādu. Bank Sakhis are supporting Bank Branch Managers in managing rush at branches during DBT payment and ensuring social distancing of customers by creating awareness among rural community.

Most importantly, SHG members engaged as BC Sakhi/ Bank Sakhi are playing a vital role in ensuring the disbursement of financial relief packages provided by Government of India. Because of them, rural community facing socio-economic distress felt fortunate to have access to banking services at their door step in the unbanked areas through BC Point to meet their daily requirements during the Lockdown period.

Indeed, BC Sakhi/ Bank Sakhi has become a focal point person in disseminating information regarding the financial relief packages announced by the Government of India in the rural areas, through which financial provisions laid down under PMGKY, PM Kisan and MGNREGS reach the population during COVID-19 pandemic.

BC Sakhis have shown their everlasting commitment at this juncture and ensured the basic banking service at door step of the community which keeps the poor out of hunger. The strength of DAY-NRLM, Ministry of Rural Development, are the approximately 690 lakh women members of around 63 lakh SHGs across the country. The motivated, enthusiastic and committed members have always contributed in addressing economic and social needs that have emerged at the community level. During the on-going crisis also, SHG members have emerged as a community warriors by contributing in every possible way to contain the spread of COVID-19 and also addressing needs evolved due to the disease outbreak.

3-Apr-2020: Direct cash transfer to women PMJDY account holders under PM Garib Kalyan Package for the month of April 2020 in the light of COVID-19 pandemic

The Ministry of Rural Development is releasing the lump sum amounts @ Rs. 500/- per woman to Pradhan Mantri Jan-Dhan Yojana (PMJDY) accountholders (as per number of such accounts intimated by banks), for April 2020, and the same have been credited to the designated accounts of individual banks on 2nd April 2020.

This follows the announcement made by the Finance Minister on 26.3.2020 regarding ex-gratia payment of Rs. 500/- per women PMJDY account holders, for next three months, under the PM Garib Kalyan Package.

In order to maintain social distancing and orderly withdrawal of money by beneficiaries, the Department of Financial Services (DFS) has directed the banks to stagger the arrival of account-holders at branches, BCs and ATMs for withdrawal of money. Following is the schedule of disbursement based on the last digit of the account number of the beneficiary:

Women PMJDY accountholders

having account number with last digit as

Date on which amount could be

withdrawn by the beneficiaries

0 or 1

3.4.2020

2 or 3

4.4.2020

4 or 5

7.4.2020

6 or 7

8.4.2020

8 or 9

9.4.2020

After 09.04.2020, the beneficiaries may go to the branch or BC on any date as per normal banking hours. Banks may accordingly phase out the credit to beneficiary accounts. Banks have been advised to intimate the above schedule to the beneficiaries through sms intimation as per the following text:

“We care for you. Under Pradhan Mantri Garib Kalyan Package, a sum of Rs. 500/- pm has been deposited in the a/c of Women Jan Dhan Yojana Beneficiaries for the month of April 2020. Pl contact your Branch/ Bank Mitra tomorrow/ on …….(date) to avoid inconvenience. Stay safe stay healthy!”

(Bank may choose the appropriate option from the underlined text)

In addition to SMS messages as per the above text, local publicity (through local channels/ print media/ cable operators/ local radio/ other channels) may also be carried out making clear that the money credited to the accounts is available for withdraw when required and if the beneficiary needs to draw the money immediately, she may approach the bank branch or BC as per the schedule mentioned in para 3 above. It may be emphasised that the schedule has been drawn up in the interest of orderly disbursement while maintaining social distancing.

In this context, State Level Bankers' Committee (SLBC) convenors have been directed to immediately contact the State Governments, apprise them of the staggering plan and seek their support for suitable security arrangements at branches, BC kiosks and ATMs. The State Government may also be requested to issue suitable instruction to the District administration and police authorities to support the bank in arranging orderly disbursement of money to be beneficiaries and in carrying out local publicity.

Heads of all Public Sector and Private Sector Banks have been asked to issue suitable instructions in this regard to Branch officials and Business Correspondents.

17-Mar-2020: 1.59 lakh Sub-Service Areas covered with at least one bank branch under Pradhan Mantri Jan-Dhan Yojana

Under Pradhan Mantri Jan-Dhan Yojana (PMJDY), all villages were mapped by banks into 1.59 lakh Sub-Service Areas (SSAs) with one SSA catering to 1,000 to 1,500 households.

As informed by banks, while 0.33 lakh Sub-Service Areas (SSAs) have been covered with bank branches, 1.26 lakh SSAs are covered by deployment of interoperable Business Correspondents (BCs).

Shri Thakur further stated that as per extant guidelines dated 18.5.2017 on rationalisation of Branch Authorisation Policy, Reserve Bank of India (RBI) has granted general permission to domestic Scheduled Commercial Banks (excluding Regional Rural Banks) to open banking outlets (i.e. a fixed point service delivery unit, manned by either bank’s staff or its Business Correspondent) at any place in the country, without seeking prior approval of RBI in each case, subject to at least 25 percent of the total number of banking outlets opened during a financial year being in unbanked rural centres i.e. centres having population less than 10,000 (Tier 5 and Tier 6 centres).

Shri Thakur stated that in pursuance of RBI guidelines, rolling out of banking outlets in uncovered areas is a continuous process and looked after by State Level Bankers' Committees, in consultation with the concerned State Government, member banks and other stakeholders. Banks, inter-alia, consider proposals for opening banking outlets in the light of RBI’s instructions, their business plans and their commercial viability.

26-Apr-2019: Total balance in Jan Dhan accounts nears ₹1-lakh cr.

Five years after its launch, the Pradhan Mantri Jan Dhan Yojana (PMJDY) scheme has almost achieved a total balance of ₹1-lakh crore.

According to the latest data, the total balance in these basic bank accounts stood at ₹99,752 crore with 35.50 crore beneficiaries. Public sector banks have the lion’s share in total balance at ₹79,177 crore, followed by regional rural banks and private sector banks maintaining ₹17,648 crore and ₹2,926 crore, respectively.

The scheme focusses on rural areas with primacy given to women. Of the 35.50-crore account holders, those from rural and semi-urban regions were 21 crore. Female beneficiaries were 18.88 crore.

Total balance under the scheme, launched on August 15, 2014, grew faster in the last there years, which was boosted by demonetisation in November 2016. It gathered momentum last year and gained rapid pace in the last six months, leading to skepticism on the possible link between elections and spurt in balances. For instance, in January 2018, the total balance was about ₹73,000 crore with 30.93 crore beneficiaries. In January, it reached ₹88,000 crore. By March, it touched ₹96,000 crore and now stands at ₹99,752 crore.

Apart from the election impact, which needs to be investigated, the advantages of the scheme, such as insurance cover and overdraft facility, must be drawing some to maintain a balance. The average balance in PMJDY accounts has also been going up.

Last year, the government had also launched Jan Dhan 2.0 to reach out to 10-12 crore unbanked individuals to bring them under the formal banking system. There have been renewed campaigns by public sector banks during the last one year, which has led to the increase in total number of beneficiaries as well as balance maintained.

6-Sep-2018: PM Jan Dhan Yojna to be open-ended scheme with more incentives

Government has decided to make the Pradhan Mantri Jan Dhan Yojana (PMJDY) an open-ended scheme and added more incentives to encourage people to open bank accounts. The overdraft facility has been doubled from Rs. 5,000 to Rs. 10,000 under the Yojana.

The age limit for availing overdraft facility under it has also been revised to 18 to 65 years from the earlier 18 to 60 years.  Accidental insurance cover for new RuPay Cardholders has been raised from Rs. one lakh to Rs. two lakh.

The Minister termed Jan Dhan Yojana as the world's biggest financial inclusion scheme saying that 32.41 crore accounts have been opened under it with more than 81 thousand 200 crore rupees of deposit balance. He said, more than 7.5 crore Jan Dhan accounts are receiving Direct Benefit Transfer.  

One crore and eleven lakh persons have subscribed for Atal Pension Yojana and 5.47 crore subscribers under Pradhan Mantri Jeevan Jyoti Bima Yojana with one lakh and ten thousand claims.

Launched in August 2014, the first phase of the PMJDY scheme focused on opening basic bank accounts and RuPay debit card with inbuilt accident insurance cover of Rs. one lakh. The second phase beginning August 2015 was planned to provide micro-insurance to the people and pension schemes to unorganised sector workers through Business Correspondents. This phase ended last month.