Pradhan Mantri Jan Dhan Yojana (PMJDY)
Background and Purpose
- Launched in 2014, PMJDY is called a National Mission for Financial Inclusion.
- The idea was very simple: large sections of India’s population had no access to the formal banking system. They were “unbanked,” which meant they could not save safely, borrow affordably, or access insurance and pension schemes.
- PMJDY aimed to change this by giving every adult Indian access to banking and financial services—at affordable cost and in a simple manner.
Quick Facts
- Purpose: To provide access to Banking, Remittance, Credit, Insurance, and Pension.
- Overdraft facility: ₹10,000 (to eligible account holders).
- Accident insurance coverage: ₹2 lakh (linked with RuPay debit card).
- Focus group: Every unbanked adult.
Objectives of PMJDY
- Ensure that financial products and services reach people at an affordable cost.
- Use of technology to reduce transaction costs and widen coverage (Aadhaar-enabled, online banking, RuPay cards).
Salient Features
(i) Banking Access Made Simple
- Accounts opened are directly part of the core banking system of banks.
- Interoperability is ensured via RuPay debit card or Aadhaar-enabled Payment System (AePS).
- Use of fixed-point Business Correspondents (BCs) so that even in remote villages, there is at least one banking agent.
- Simplified KYC / e-KYC → Instead of lengthy paperwork, Aadhaar and minimal documents are enough.
(ii) RuPay Card Benefits
- Every PMJDY account holder gets a RuPay Debit Card.
- Free accidental insurance cover:
- Earlier ₹1 lakh,
- Increased to ₹2 lakh for accounts opened after 28th August 2018.
(iii) Overdraft Facility
- Small overdraft allowed: ₹2,000 without conditions.
- Full overdraft: Up to ₹10,000, provided the account is operated satisfactorily.
- Upper age limit for overdraft: 65 years.
(iv) Inoperative Accounts
- As per RBI guidelines, if no transaction (by the customer) takes place for two years, the account is treated as inoperative.
Technology Support – Jan Dhan Darshak App
- A mobile app to help citizens locate the nearest:
- Bank branch
- ATM
- Bank Mitra (Business Correspondent)
- Post Office banking point
This made financial access more visible and user-friendly.
Linkages with Other Schemes
PMJDY accounts act as a foundation for availing other schemes:
- Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) – Life insurance
- Pradhan Mantri Suraksha Bima Yojana (PMSBY) – Accidental insurance
- Atal Pension Yojana (APY) – Pension for the unorganized sector
- MUDRA Scheme – Credit support for small entrepreneurs
The “Three Tenets” of PMJDY
- Banking the Unbanked → Basic Savings Bank Deposit (BSBD) accounts with zero balance, simple KYC.
- Securing the Unsecured → RuPay debit cards with accident insurance of ₹2 lakh.
- Funding the Unfunded → Access to micro-insurance, overdraft, pension, and credit services.
The “Six Pillars” of PMJDY (Broader Framework)
- Universal access to banking services.
- Basic savings account + overdraft of ₹10,000.
- RuPay Debit Card with insurance cover.
- Financial literacy programs.
- Creation of Credit Guarantee Fund.
- Pension & insurance schemes for the unorganized sector.
✅ In summary:
PMJDY is not just a scheme, it is the largest financial inclusion drive in the world, which made banking a basic right for every Indian adult. It connects the poor with the formal financial system, giving them dignity, security, and opportunities.