The government initiated the National Mission for Financial Inclusion (NMFI), namely, Pradhan Mantri Jan Dhan Yojana (PMJDY) in August 2014 to provide universal banking services for every unbanked household.

As on November 20, 2024, a total of 54.03 crore Jan Dhan accounts have been opened under PMJDY, with a deposit balance of Rs 2,37,575 crore.

Pradhan Mantri Jan Dhan Yojana (PMJDY)

• Pradhan Mantri Jan Dhan Yojana (PMJDY) continuously endeavours to provide support to the marginalised and economically backward sections through its financial inclusion interventions.

• With a view to increase banking penetration, promote financial inclusion and to provide at least one bank account per household across the country, a National Mission on Financial Inclusion, known as Pradhan Mantri Jan Dhan Yojana (PMJDY), was announced on August 15, 2014. 

• The scheme was formally launched on August 28, 2014 at national level by Prime Minister Narendra Modi.

• In order to give impetus to financial inclusion initiatives of the government, PMJDY scheme was extended with the focus on opening of accounts shifting from “every household” to “every unbanked adult”. 

How does PMJDY help in financial inclusion?

• PMJDY has been successful in increasing banking penetration and to promote financial inclusion across the country.

• In the Indian context, financial inclusion is the process of ensuring access to appropriate financial products and services needed by vulnerable groups, such as weaker sections and low income groups, at an affordable cost in a fair and transparent manner by mainstream institutional players. 

• Financial inclusion is a national priority 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 in villages besides taking them out of the clutches of the usurious money lenders. 

• Jan Dhan Yojana is one of the biggest financial inclusion initiatives in the world.

• Census 2011 estimated that out of 24.67 crore households in the country, only 14.48 crore (58.7 per cent) had access to banking services. 

• In the first phase of the scheme, these households were targeted for inclusion through opening of a bank account within a year of launch of the scheme.

• Notably, there are no account opening fees or maintenance charges and no requirement to maintain a minimum balance under this scheme.

• It offers basic savings bank accounts with an overdraft facility of Rs 10,000 to every account holder.

Basic tenets of the scheme:

i) Banking the Unbanked: Opening of basic savings bank deposit accounts with minimal paperwork, relaxed KYC, e-KYC, account opening in camp mode, zero balance and zero charge.

ii) Securing the Unsecured: Issuance of indigenous debit cards for cash withdrawals and payments at merchant locations, with free accident insurance coverage of Rs 2 lakh.

iii) Funding the Unfunded: Other financial products like micro-insurance, overdraft for consumption, micro-pension & micro-credit.

Other schemes:

In addition to the PMJDY, the following schemes have been launched to provide social security and affordable financial services for all, especially marginalised and underserved populations:

1) Pradhan Mantri Suraksha Bima Yojana (PMSBY): The scheme is a one-year personal accident insurance scheme, renewable from year to year, offering coverage of Rs 2 lakh for death or permanent total disability and Rs 1 lakh for permanent partial disability due to an accident at a premium of Rs 20 per annum. It is available to people in the age group of 18 to 70 years having a bank account who give their consent to join the scheme. As on November 20, 2024, cumulative enrolment under PMSBY is 47.59 crore.

2) Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY): The scheme is a one-year life insurance scheme, renewable from year to year, offering coverage of Rs 2 lakh for death due to any reason at a premium of Rs 436 per annum and is available to people in the age group of 18 to 50 years having a bank account who give their consent to join the scheme. As on November 20, 2024, cumulative enrolment under PMJJBY is 21.67 crore.

3) Atal Pension Yojana: The scheme aims to provide monthly pension to eligible subscribers with age limit of 18 to 40 years not covered under any organised pension scheme. Under this scheme, the subscribers would receive the fixed minimum pension of Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000 and Rs 5,000 per month, at the age of 60 years, depending on the contributions. As on November 20, 2024, enrolments under this scheme are 7.12 crore.

4) Pradhan Mantri Mudra Yojana (PMMY): The scheme provide access to institutional finance to micro/small business units up to Rs 20 lakh for income generating activities such as manufacturing, trading, services, activities allied to agriculture. As on November 1, 2024, as many as 50.31 crore loans amounting to Rs 31.28 lakh crore have been sanctioned since inception of the scheme.

5) Stand Up India Scheme (SUPI): The scheme aims to promote entrepreneurship among people from Scheduled caste/Scheduled tribe and women. The scheme facilitates bank loans between Rs 10 lakh and Rs 1 crore to one Scheduled Caste/Scheduled Tribe borrower and one woman borrower per bank branch of Scheduled Commercial Banks for setting up greenfield enterprises in trading, manufacturing and services sector. As on November 18, 2024, as many as 2.52 lakh loans amounting to Rs 56,953 crore have been sanctioned since inception of the scheme.

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