The number of inoperative accounts under the Pradhan Mantri Jan Dhan (PMJDY) scheme has halved to one in five as on date, according to government data.

As on January 15, the total number of PMJDY accounts opened was 37.87 crore, of which 30.78 crore, or 81.3 per cent, are operative. The share of inoperative vis-a-vis total accounts, which was 40 per cent in March 2017, declined to over 18 per cent as on January 15 this year. The maximum number of inoperative accounts are in Uttar Pradesh, Bihar and Madhya Pradesh.

Dormant accounts

The Government data do not throw light on the remaining over 7-crore inoperative accounts: Have they been closed or has there there been no transaction after a certain period? According to the Reserve Bank of India’s Master Circular of July 1, 2015 on customer service in banks, savings accounts (including PMJDY accounts) are treated as inoperative/dormant if there has been no transaction in the account for over two years.

Also, information on the number of closed PMJDY accounts is not centrally maintained. However, accounts monitored by the Department of Financial Services under the Finance Ministry show that the number of these accounts has increased every year since the launch of the scheme.

During and post-demonetisation, it was alleged that huge sums were withdrawn from many of these accounts. Post demonetisation, the percentage of inoperative accounts reached 40 per cent, but has since been declining.

Shift in focus

Launched in 2014. PMJDY envisages universal access to banking facilities with at least one basic bank account for every household, financial literacy, access to credit, insurance and pension. To give impetus to the government’s financial inclusion initiatives, the PMJDY programme has been extended beyond 2018 with the focus of account opening shifting from ‘every household’ to ‘every un-banked adult’.

Also, to make the scheme more attractive, it was decided to double the overdraft limit to ₹10,000. There were no conditions attached for those with active PMJDY accounts availing themselves of the OD facility up to ₹2,000. Age limit was revised from 18-60 years to 18-65 years.

Also, accident insurance cover for new RuPay card holders was raised to ₹2 lakh from ₹1 lakh for PMJDY accounts opened after August 28, 2018. Under the scheme, as on January 22, about 29.86 crore RuPay cards have been issued to PMJDY account-holders.