Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched on August 28, 2014, with the aim of ensuring accessibility to various financial services such as availability of basic savings bank account, need-based credit , remittance facility, insurance, microcredit and pension for excluded sections, which include weaker sections and low income groups. This deep penetration at an affordable cost is only possible with effective use of technology and for this massive step towards financial inclusion, credit goes to the Narendra Modi government.
PMJDY is a national mission on financial inclusion encompassing an integrated approach to achieve full financial inclusion for all households in the country. The plan envisages universal access to banking facilities with at least one basic bank account for each household, financial education, access to credit, insurance and retirement facility. Additionally, recipients get a RuPay debit card which comes with an accident insurance cover of Rs 2 lakh. The plan also envisions channeling all government benefits from the Center, state and local agencies to beneficiary accounts and promoting the government’s Direct Benefit Transfer (DBT) program. Technology issues such as poor connectivity and issues in online transactions have been effectively solved through mobile transactions over the past seven years. In fact, technology has rightly been used as a great enabler, which never happened in a significant way before 2014. Also, an effort is being made to reach out to young people across the country to participate to this program in mission mode.
Digital India, an enabler
Prime Minister Narendra Modi’s Digital India presents three big results for technology. They are: technology to transform the lives of citizens, to expand economic opportunities and to create strategic capabilities in certain technologies. Former Prime Minister Rajiv Gandhi had said that in 1980s India, out of bounties worth 1 Re, only 15 paise reached the true beneficiary. The remaining 85 paise were gobbled up by intermediaries and sarkari babus. Thanks to PM Modi’s Digital India, 100% of the profits now reach the beneficiary via DBT. The success of this transformation lies in the vision of Prime Minister Modi, in the application of technology, using Aadhaar which has plugged all the leaks in the system, eradicated middlemen and prevented endemic corruption which was the scourge of India under successive congressional regimes.
Savings to the treasury from the use of Aadhaar and DBT, mainly due to the elimination of false payees and duplicates, have been estimated at over Rs 2.24 lakh crore.
In Uttar Pradesh alone, benefits of more than Rs 2.8 lakh crore (cumulative) were transferred directly to recipients’ accounts. About 15 million people in UP have benefited from the various central/state government programs through DBT, leveraging Aadhaar. Therefore, Aadhar is not only the largest digital identity program in the world, but also a tool to empower people by securing their rights.
Talking about Aadhaar, more than 313 central government schemes have been advised to use Aadhaar for watertight delivery of various social benefits such as PM-KISAN, PM Awas Yojana, PM Jan Arogya Yojana, PAHAL, MGNREGA, National Program d social security assistance, PDS, etc. Aadhaar partnered with PMJDY and Mobile (JAM Trinity) have created a robust platform to accelerate financial inclusion. Payment services enabled by Aadhaar provide easy access to banking services through fingerprint authentication.
India has developed huge capacities under the Digital India program launched by Prime Minister Narendra Modi in 2015. The locally developed CoWIN portal, which has delivered over 155 crore vaccinations to date, is a model that has been hailed worldwide and is now being emulated by other countries as well. It is a vindication of how India has bridged the digital divide, making the concepts of financial inclusion and last mile delivery feasible. The UP government’s COVID management, which has successfully leveraged technology by leveraging a network of around 1.5 lakh Common Services Center (CSC) and 4.5 lakh Village Level Entrepreneurs (VLE) to facilitate over 20 crore of vaccinations in UP, more than six times the population of Australia, is a great example of digital inclusion by the Modi-Yogi dual engine sarkar. With the recently commissioned Aadhaar Seva Kendras (ASKs) in addition to the existing ones in Gonda, Varanasi, Saharanpur and Moradabad, the citizens of UP will witness the march towards a “digital Uttar Pradesh”, faster than ever before .
Last year, the proposal to provide monetary aid to 11.8 million students (118 million students) through the DBT for the kitchen costs component of the All Children Lunch Scheme eligible as a special welfare measure is another example of digital empowerment. This proposal was in addition to the Modi government’s announcement of free distribution of food grains at Rs 5 per kg, per person, per month, to nearly 81 million beneficiaries under the Pradhan Mantri Garib Kalyan Anna Yojana (PM- GKAY).
This decision/proposal will help preserve children’s nutritional levels and protect their immunity during difficult pandemic times. The Modi government will provide additional funds of around Rs 1200 crore to state governments and UT administrations for this purpose. This one-time special welfare measure from the Union Government will benefit around 11.8 million children studying in grades 1 to 8 in 11.20 lakh government and government-subsidized schools across the country.
Jan Dhan’s Revolution
Going back to Jan Dhan, more than 44.34 crore beneficiaries have been banked under PMJDY since its inception, representing transactions worth more than Rs 1.55 lakh crore. Over 1.26 lakh Bank Mitras has become part of the Jan Dhan Yojana program, to ensure that it reaches the remotest and poorest in India. PMJDY accounts have more than tripled from 14.72 crore in March 2015 to 44.34 crore to date.
Over 55% of Jan Dhan account holders are women and over 67% of Jan Dhan accounts are in rural and semi-urban areas, demonstrating PM Modi’s unwavering commitment to last mile delivery . Of the total 44.34 crore PMJDY accounts, well over 86% are operational, shattering the myth peddled by the opposition that PMJDY is a dormant scheme. The total of RuPay cards issued to PMJDY account holders stands at over 31.23 crore.
Under Prime Minister Garib Kalyan Yojana, a sum of more than Rs 30,945 crore was credited to the accounts of female PMJDY account holders during the COVID lockdown. More than 8 crore PMJDY account holders have received Direct Benefit Transfer (DBT) from the Modi government under various welfare schemes at one time or another. Overall, to date, more than Rs 18 lakh crore has been disbursed via DBT to the needy under the Modi government, which is not an average achievement by any measure.
Financial inclusion is a national priority for the Modi government as it is a catalyst for holistic growth. The journey of PMJDY-led interventions undertaken over a short period of seven years has, indeed, produced both transformational and directional change, making the emerging financial ecosystem capable of providing financial services to the last person in society. and to the poorest. poor. The underlying pillars of PMJDY, namely Banking the Unbanked, Securing the Unsecured and Funding the Unfunded, enabled a multi-stakeholder collaborative approach, while leveraging technology to also serve unserved and underserved areas.
Banking the Unbanked is about opening a Basic Savings Bank (BSBD) deposit account with minimal paperwork, relaxed KYC, e-KYC, camp mode account opening, zero balance and zero fees. Securing the unsecured is about issuing native debit cards for cash withdrawals and payments at merchants, with free accident insurance coverage of Rs 2 lakh. The financing of the unfinanced concerns other financial products such as micro-insurance, overdraft for consumption, micro-retirement and micro-credit. Jan Dhan accounts are online accounts in the central banking system of banks, replacing the previous method of offline accounts. Interoperability via RuPay Debit Card or Aadhaar Compatible Payment System (AePS) has been a force multiplier.
The Modi government has decided to extend the full PMJDY program beyond 2018 with some modifications. The focus shifted from “Every Household” to “Every Unbanked Adult”. Free accidental insurance coverage on RuPay cards has been increased from Rs 1 lakh to Rs 2 lakh for PMJDY accounts opened after August 28, 2018. Enhanced Overdraft (OD) facilities have been enabled, with an OD limit doubled from Rs 5,000 to Rs 10,000 and with OD up to Rs 2000 given without conditions. The upper age limit for OD has also been raised from 60 to 65 years.
PMJDY has been the cornerstone of people-centered economic initiatives. Whether direct benefit transfers, COVID-19 related financial relief, PM-KISAN, wage increases under MGNREGA, life and health insurance coverage, the first step in all of these initiatives is to provide every adult with a bank account, which the PMJDY made on a war footing. One in two bank accounts opened between March 2014 and March 2020 was a PMJDY account. Within 10 days of the nationwide lockdown, over 20 million women’s PMJDY accounts were credited free of charge.
Jan Dhan offers the poor a way to bring their savings into the formal financial system, a way to get money back to their families in the villages in addition to getting them out of the clutches of the infamous and usurious moneylenders. PMJDY has brought the unbanked into the banking system, expanded India’s financial architecture, and brought financial inclusion to almost every adult. In the current times of COVID-19, we have witnessed the remarkable speed and fluidity with which Direct Benefit Transfers (DBT) have strengthened and provided financial security to vulnerable sections of society.
An important aspect is that DBTs through Prime Minister Jan Dhan’s accounts have ensured that every rupee reaches its intended beneficiary, preventing systemic leaks. Needless to add, zero tolerance for corruption is not just a slogan or a platitude, but an enduring work ethic for the Modi government, with the concept of “integral humanism”, embedded in every measure of well-being. to be that Prime Minister Modi has worked so tirelessly. the past seven years.
Sanju Verma is an economist, national spokesperson for the BJP and best-selling author of “The Modi Gambit”. The opinions expressed in this article are those of the author and do not represent the position of this publication.
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