Jan Dhan Yojana completes one year; to shift focus
The PMJDY scheme will be shifting its focus to reducing inactive accounts. In July 2015, banks were directed to bring down the number of inactive accounts and grant loans to active holders. Reportedly, inactive accounts would be down to 10% or less soon. The government is likely to initiate the direct benefit transfer (DBT) scheme soon, which should see a significant rise in savings.
Government announces financial inclusion scheme
On 15 August 2014, Modi announced the Pradhan Mantri Jan Dhan Yojana (PMJDY) scheme. Implemented on 28 August 2014, its target was to open 7.5 crore accounts by January 2015. The objective of this national financial inclusion scheme was to ensure universal access to banking accounts, insurance, remittance, credit and pension in an affordable way. 1.5 crore accounts were opened on the inaugural day.
Bank accounts for each household a national priority
Under the scheme, account holders were to be provided with a zero-balance savings account, a RuPay debit card and Rs.1 lakh of accident insurance. Overdraft facilities of Rs.5,000 were to be made available six months after opening the account. Mobile banking for the poor was to be made available through the National Unified USSD Platform, through united efforts of banks and mobile phone companies.
PMJDY sets new World Record
18,096,130 confirmed new bank accounts were opened from 23-29 August, 2014 in the PMJDY scheme, setting a new Guinness World Record for the most number of bank accounts opened in a week.
PMJDY exceeds expectations
The PMJDY was a huge success. Its initial target of 7.5 crore accounts by January 2015, was almost reached within two months of implementation. By November 2014, it had a tally of 7 crore accounts, and the target was revised to 10 crore accounts. As of today, the PMJDY has 17.45 crore accounts and a total deposit of over Rs.20,000 crore.
Is there anything new in the PMJDY?
Congress claimed that Modi was taking credit for the financial inclusion scheme started by the UPA government. In fact, the DBT scheme was launched in January 2013 to transfer LPG cash subsidies to Aadhar-linked bank accounts. Free insurance and overdraft facilities may have lured existing bank account holders to create a PMJDY account for themselves. Many experts feel that PMJDY aims to please voters.
What is DBT?
The aim of the Direct Benefit Transfer (DBT) scheme is to transfer kerosene and food subsidies directly to the accounts of beneficiaries of the PMJDY scheme. Through DBT, the government aims to lower its subsidy bills and eliminate frauds.