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EconomySchemes2014

PM Jan Dhan Yojana

Basic bank accounts for unbanked households.

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Ministry of Finance. It forms the account base for direct benefit transfers.

The launch of the Pradhan Mantri Jan Dhan Yojana, 2014.
The launch of the Pradhan Mantri Jan Dhan Yojana, 2014. Prime Minister's Office, Government of India, GODL-India, via Wikimedia Commons
Practise this in the app: flashcards, quiz and a timed answer
Prelims

Quick recall

When was PMJDY launched?
28 August 2014.
What kind of accounts does it offer?
Basic savings accounts with zero minimum balance.
Which card do account holders get?
A RuPay debit card with accident insurance.
What is the JAM trinity?
Jan Dhan, Aadhaar and Mobile.
What is DBT?
Direct benefit transfer of subsidies into beneficiaries' accounts.
Which insurance and pension schemes build on it?
PMJJBY, PMSBY and Atal Pension Yojana.

Asked before in UPSC

Recurring theme: Financial inclusion and direct benefit transfer (JAM trinity)

Mains
  1. 2026 · GS3 · 10 marks

    Examine the view that financial inclusion is an integral part of social and economic inclusion in a country like India. Also throw light on the usefulness of the R.B.I.'s Financial Inclusion Index.

    PMJDY is the backbone of India's financial inclusion push and a major driver of the RBI's FI-Index.

  2. 2022 · GS3 · 10 marks

    Is inclusive growth possible under market economy? State the significance of financial inclusion in achieving economic growth in India.

    Jan Dhan accounts as the first step of the JAM trinity enabling credit, insurance and DBT for the poor.

  3. 2022 · GS2 · 10 marks

    Reforming the government delivery system through the Direct Benefit Transfer Scheme is a progressive step, but it has its limitations too. Comment.

    Jan Dhan accounts are the delivery rail for DBT; cite leakage savings along with exclusion errors and last-mile cash-out problems.

  4. 2016 · GS3 · 12.5 marks

    Pradhan Mantri Jan Dhan Yojana (PMJDY) is necessary for bringing unbanked to the institutional finance fold. Do you agree with this for financial inclusion of the poor section of the Indian society? Give arguments to justify your opinion.

    A direct PMJDY question: use account numbers, zero-balance and dormancy data, and the insurance and overdraft add-ons.

  5. 2013 · GS2 · 10 marks

    Electronic cash transfer system for the welfare schemes is an ambitious project to minimize corruption, eliminate wastage and facilitate reforms. Comment.

    The pre-PMJDY debate on electronic cash transfers shows why universal bank accounts were a precondition for DBT.

Prelims
  1. 2016 · Prelims

    The establishment of 'Payment Banks' is being allowed in India to promote Financial Inclusion. Which of the following statements is/are correct in this context? 1. Mobile telephone companies and supermarket chains that are owned and controlled by residents are eligible to be promoters of Payment Banks. 2. Payment Banks can issue both credit cards and debit cards. 3. Payment Banks cannot undertake lending activities.

    Payment banks are a companion financial-inclusion tool to Jan Dhan accounts.

  2. 2015 · Prelims

    'Pradhan Mantri Jan-Dhan Yojana' has been launched for (a) providing housing loan to poor people at cheaper interest rates (b) promoting women's Self-Help Groups in backward areas (c) promoting financial inclusion in the country (d) providing financial help to the marginalized communities

    Direct factual question on the scheme's objective: financial inclusion.

  3. 2014 · Prelims

    What is/are the facility/facilities the beneficiaries can get from the services of Business Correspondent (Bank Saathi) in branchless areas? 1. It enables the beneficiaries to draw their subsidies and social security benefits in their villages. 2. It enables the beneficiaries in the rural areas to make deposits and withdrawals.

    Business correspondents (Bank Mitras) are the last-mile channel through which PMJDY accounts are served.

The basics

Why it matters

PM Jan Dhan Yojana, launched in August 2014, aimed to give every household a bank account. It became the base for direct benefit transfers, insurance and pensions.

2014
Launch year of PM Jan Dhan Yojana
Launched on 28 August 2014.

The JAM trinity

Accounts linked with Aadhaar and mobile phones enabled direct transfers.

JAM trinity
  1. 1Jan DhanBank accounts
  2. 2AadhaarBiometric identity
  3. 3MobileAccess and alerts
  4. 4DBTMoney sent directly

You now know

  • Launched on 28 August 2014 for universal access to banking.
  • Zero-balance accounts with a RuPay debit card.
  • Accident insurance and an overdraft facility for eligible holders.
  • Formed the JAM trinity with Aadhaar and mobile for DBT.

Go deeper

In one line: Jan Dhan brought hundreds of millions into formal banking and made direct transfers possible.

Why it matters for UPSC

Financial inclusion and DBT are standard GS2 and GS3 topics.

The core idea

An account is the pipe through which subsidies, wages and insurance flow. Linked with Aadhaar and phones as the JAM trinity, it cut leakages. The next step is Financial inclusion beyond account ownership.

Where to go next

In one line: Accounts are only the first step; usage, credit and insurance matter more.

Achievements

More than half of new accounts were opened by women; DBT savings through removing duplicates.

Gaps

Dormant accounts and limited credit. See JAM trinity and Financial inclusion.

Where to go next

JAM trinity

Accounts, identity and mobile together

In one line: JAM stands for Jan Dhan, Aadhaar and Mobile, used together for direct benefit transfers.

Origin

Highlighted in the Economic Survey 2014-15.

Effect

Faster payments and fewer duplicate beneficiaries.

Where to go next

Financial inclusion

Access to affordable financial services

In one line: Financial inclusion means access to affordable savings, credit, insurance and payments.

Tools

Bank accounts, UPI, microfinance and small finance banks.

Measure

The RBI's Financial Inclusion Index.

Where to go next

Prelims-style quiz

  1. The JAM trinity includes:

    1. Jobs, Agriculture, Manufacturing
    2. Jan Dhan, Aadhaar, Mobile
    3. Jan Dhan, Ayushman, MGNREGA
    4. Justice, Accountability, Mobility
    Show answer

    Answer: (b) Jan Dhan, Aadhaar, Mobile. Jan Dhan, Aadhaar and Mobile.

  2. PM Jan Dhan Yojana was launched in:

    1. 2011
    2. 2016
    3. 2019
    4. 2014
    Show answer

    Answer: (d) 2014. August 2014.

  3. Consider the following:
    1. PMJDY accounts require a minimum balance.
    2. Holders receive a RuPay debit card.
    Which of the statements given above is/are correct?

    1. 1 only
    2. 2 only
    3. Both 1 and 2
    4. Neither 1 nor 2
    Show answer

    Answer: (b) 2 only. Accounts are zero-balance.

  4. Which scheme offers accident insurance at a low premium?

    1. APY
    2. PMSBY
    3. PMJDY
    4. PMJJBY
    Show answer

    Answer: (b) PMSBY. PM Suraksha Bima Yojana.

Syllabus

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