Though the Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched with a view to bring the un-banked into the formal banking space, the fact that money launderers have pumped in over R27,000 crore into these accounts between November 10 and 23 has given financial inclusion an altogether new meaning. With a month to go for demonetisation to be completed, and the possibility of even more money being laundered via PMJDY, RBI has moved to cap withdrawals from these accounts—a fully KYC-compliant account-holder can pull out R10,000 in a month while a non-KYC compliant account holder can withdraw R5,000 per month.
Putting limits on withdrawals is a good start, but what is allowed is too generous. RBI should immediately zero in on accounts which show suspicious transactions and either freeze them altogether, or limit withdrawals to very small amounts, possibly the average of the balance over the three months prior to demonetisation. Based on the pre-demonetisation deposits, the average balance in all PMJDY accounts was R1,788—this rises to R2,331 if the 5.9 crore zero-balance accounts are excluded.
While it might not be easy to track down the offenders since the money would be spread across hundreds of accounts, there appear to be some parts of the country that have attracted particularly large Jan-Dhan inflows. The Kolkata-headquartered United Bank of India, for instance, appears to have received a disproportionately high inflow of money in the fortnight to November 23, of R1,656 crore.
Indeed, some regional rural banks in West Bengal have seen money pouring in with a 56% jump in deposits being reported. Such accounts would perhaps be a good place to start. Moreover, it is highly unlikely such large sums of money could have been deposited without the support of bank officials; quizzing them quickly will throw up good leads—even if every offender isn’t caught, the tax authorities need to investigate. And even as the investigation progresses, the government needs to ensure that all Jan-Dhan accounts are seeded with Aadhaar—just over half, or 13.84 crore accounts, have been seeded which makes the possibility of fraud that much higher.