Pradhan Mantri Jan Dhan Yojana (PMJDY) – a national mission on financial inclusion

The Prime Minister of India has formally launched Pradhan Mantri Jan Dhan Yojana (PMJDY) on Thursday, 28th August, 2014. The PMJDY is launched as a national mission on financial inclusion with the objective of covering all households in the country with banking facilities, with having a bank account for each household. Financial literacy has been accorded priority under the PMJDY. A standardized financial literacy material has also been prepared in vernacular languages to create awareness about the Yojana. It is estimated to cover 7.5 crore households with at least one bank account under this Yojana.

The Pradhan Mantri Jan Dhan Yojana lies at the core of the Government’s development philosophy of Sab Ka Sath Sab Ka Vikas. With a bank account, every household gains access to banking and credit facilities, receive cash transfers such as G2Ps under several welfare programmes, particularly the poorer sections of the society. Access2Finance is expected to enable households benefit from a range of financial products (such as savings, insurance and pension), manage to keep away from financial vulnerability caused by emergent needs, and most importantly, enable them to come out of the grip of moneylenders. As a first step, every account holder gets a RuPay debit card with a Rs.1,00,000/- accident cover, and an overdraft facility in due course.

The Mission will be implemented in two phases:

Phase-I from 15th August 2014 to 14th August 2015 envisages
· Universal access to banking facilities for all households across the country through a bank branch or a fixed point Business Correspondent (BC) within a reasonable distance;

· To cover all households with at least one Basic Banking Accounts with RuPay Debit card having inbuilt accident insurance cover of Rs.1 lakh. Further an overdraft facility up to Rs.5000 will also be permitted to Aadhaar enabled accounts after satisfactory operation in the account for 6 months.

· Financial literacy programme which aims to take financial literacy up to village level.

· The Mission also envisages expansion of Direct Benefit Transfer under various Government Schemes through bank accounts of the beneficiaries.

· The issuance of Kisan Credit Card (KCC) as RuPay Kisan Card is also proposed to be covered under the plan.

Phase-II from 15th August, 2015 to 14th August, 2018
· Providing micro – insurance to the people.

· Unorganised sector Pension schemes like Swablamban through the Business Correspondents

The major shift in this programme is that households are being targeted instead of villages or population density based parameters as targeted earlier. Moreover both rural and urban areas are being covered this time as against only rural areas targeted earlier. The present plan pursues digital financial inclusion with special emphasis on monitoring by a Mission headed by the Finance Minister. The PMJDY is expected to bring the financial literacy under a campaign mode to spread the awareness of financial products, inculcate banking habits and build credit information of the masses


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