India achieves near-universal banking coverage

• The country has achieved near-universal banking coverage, Minister of State in the Ministry of Finance Pankaj Chaudhary in the Lok Sabha on August 3.

• About 99.92 per cent of inhabited villages (6,00,868 out of 6,01,328) are now served by a banking outlet within a radius of 5 km, as per the data uploaded by banks on Jan Dhan Darshak (JDD) App.

• This banking expansion is supported by a robust infrastructure of over 1.81 lakh bank branches, 17.36 lakh Business Correspondents (BCs), and 1.65 lakh India Post Payments Bank (IPPB) centers.

• Reserve Bank of India (RBI) has permitted commercial banks, small finance banks, payments banks, local area banks and regional rural banks, to open bank branches anywhere in India without prior approval, provided 25 per cent are in unbanked rural areas.

• In pursuance of extant RBI guidelines, rolling out of banking outlets in uncovered areas is a continuous process looked after by the State Level Bankers’ Committee (SLBC) / Union Territory Level Bankers Committee (UTLBC), in consultation with the concerned state/UT government, member banks and other stakeholders. 

• Banks consider proposals for opening banking outlets in light of RBI’s instructions, their business plans and their commercial viability.

• As on July 17, 2026, there are a total number of 58.77 crore Pradhan Mantri Jan-Dhan Yojana (PMJDY) accounts in the country, having a balance of Rs 3,12,414 crore.

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.

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.

(The author is a trainer for Civil Services aspirants.)