Jan Dhan Yojana opens 11.5 cr accounts ahead of deadline

Finance ministry acknowledges that challenge is to keep accounts active

Ahead of the Monday (January 26) deadline, the target of opening 115 million bank accounts has been formally achieved at the government’s flagship Pradhan Mantri Jan Dhan Yojana.

The original target was to reach 75 mn households in this period.

Addressing the media, Finance Minister Arun Jaitley said the Guinness World Records had given a certificate that the ‘Most bank accounts opened in one week as part of a financial inclusion campaign is 18,096,130 and was achieved by the department of financial services, Government of India, from August 23 to 29, 2014.’

The minister noted the contributions of public sector banks to the scheme. Such a large survey had earlier been done only in the national population census, he said.

A survey was conducted in about 227,000 zones in rural areas and wards in urban areas over four months. The ministry says coverage of 99.74 per cent of surveyed households has been achieved so far.

The finance ministry acknowledged the further challenge is to keep operational the accounts opened under the scheme. Till date, only 28 per cent are active, with approximately Rs 9,000 crore of deposits.

Accident cover up to Rs 1 lakh and a life insurance cover up to Rs 30,000 were incentives, including a RuPay debit card and overdraft facility, to draw in the unbanked population.

To keep the accounts operational, the government has linked these with the Direct Benefits Transfer of LPG (DBTL) and other government schemes. Under the DBTL subsidy, said Jaitley, Rs 1,757 crore had been transferred to beneficiary accounts since November 15.

So far, 19 of 35 subsidy schemes to be done through DBT have been launched. That includes MGNREGS, the rural jobs guarantee, in 300 districts. State governments have been requested to transfer money directly in the bank accounts of beneficiaries.

Of the accounts opened, 60 per cent are in rural areas and 40 per cent are in urban areas. The share of female account holders is 51 per cent.

Another challenge that lies ahead of the ministry is connectivity of accounts in rural parts. “We are talking with the telecom minister to increase connectivity for villages that had issues around that,” said Hasmukh Adhia, secretary, department of financial services.