Net cash accretion in no-frills Pradhan Mantri Jan Dhan Yojana (PMJDY) bank accounts rose to an all-time high of Rs 36,153 crore in 2023-24, which also showed that average cash deposits per account at a high of Rs 4,524.
Despite reaching near saturation levels, as many as 33 million new PMJDY accounts were opened in FY24, taking the cumulative PMJDY accounts at 519.5 million. The total balance in these accounts stood at Rs 2,34,997 crore compared with Rs 1,98,844 crore a year ago.
While the overall balance in Jan Dhan accounts rose by 18% in FY24 as against 19% in FY23 while the deposits per Jan Dhan account rose 22% on year in FY24 compared with 7% in FY23. This was aided by moderation in new account additions due to the saturation level in account opening. Around 33 million new accounts were opened in FY24 compared with 35.9 million in FY23 and 28.6 million in FY22.
Even though it was anticipated that the accounts were largely opened to get government benefits, the accounts have been a source of a large pool of low-cost funds for public sector banks.
PMJDY was launched on August 28, 2014, to provide universal banking services by opening a zero-balance bank account for every unbanked household. The main features of the scheme include one basic savings bank deposit (BSBD) account for every unbanked adult, an overdraft (OD) limit of Rs 10,000 and a free RuPay debit card with inbuilt accident insurance cover of up to Rs 2,00,000.
However, the public sector banks have been lagging in providing debit cards to each account holder, depriving them an easy option to withdraw cash when they need it. According to the latest data, 353.7 million or 68% of the Jan Dhan account holders have debit cards. Given that inoperative accounts are nearly 20%, at least 12% of active account holders still don’t have RuPay cards. Of the nearly 500 million accounts with public sector banks and regional rural banks, only 340 million have RuPay debit cards.
As per the latest data, PMJDY’s balance with the State Bank of India was at Rs 59,203 crore, followed by Bank of Baroda at Rs 32,032 crore and Punjab National Bank at Rs 22,594 crore. Public sector banks and regional rural banks sponsored by them account for 97% of the total PMJDY balance of Rs 2.35 trillion.
The JAM Trinity – Jan Dhan, Aadhaar, mobile – has stood the government in good stead in implementing large-scale, technology-enabled and real-time direct benefit transfers (DBTs) to improve the welfare of the low-income category people, especially during Covid.
Transfer of assorted subsidies and sops to the beneficiaries through the Direct Benefit Transfer (DBT) mechanism resulted in savings of nearly Rs 3.5 trillion between FY15 and FY23.
There is no requirement to maintain any minimum balance in PMJDY accounts. Deposits in such accounts earn interest of 3-4%.
