Jan Dhan: Now, no more worry over zero balance accounts

Nearly four-and-a-half years since the launch of the Pradhan Mantri Jan Dhan Yojana (PMJDY), the number of zero-balance accounts under the government’s flagship scheme has declined to less than a quarter of all accounts and have stopped being a major source of worry for policymakers.

Estimates peg the inoperative/zero-balance accounts at little more than 20 per cent of the 33.66 crore beneficiary accounts. This is significantly lower than the 76.81 per cent reported when the scheme was started in September 2014.

“There is a growing awareness about these accounts and they are being used actively by almost all beneficiaries, especially with significant amount of subsidy transfers into these accounts. The number of zero-balance accounts has gone down,” noted a government official, adding that some of these accounts may be inactive due to erroneous details or withdrawal of funds.

“The impact of the scheme is evident and zero-balance accounts are not a significant worry,” he said, adding that banks are still working with these account-holders to increase awareness. Responding to a question in the Lok Sabha on December 21, Finance Minister Arun Jaitley had said that 25.69 crore of the 33.54 crore PMJDY accounts were operative or in use as on December 12, 2018. This means that about 7.85 crore accounts or about 23 per cent of all accounts under the scheme are still inoperative or have zero balance.

No central monitoring

To another question in the Lok Sabha on December 14, Minister of State for Finance Shiv Pratap Shukla said that zero-balance accounts under the PMJDY are no longer being centrally monitored.

“Depending on the transactions carried out by a Jan Dhan account holder, the balance in any Jan Dhan account can vary on a day-to-day basis and may even become zero on a particular day. Hence, zero-balance accounts under the PMJDY are not centrally monitored,” he had said. Business correspondents and experts say that many of the zero- balance accounts are due to duplication or lack of awareness.

“Even now, in many rural areas, especially in Uttar Pradesh and Bihar, people don’t realise that they have a bank account or money accruing in it through subsidies. It is only when they are asked pointed questions about a bank account that they begin to realise,” noted an executive with a business correspondent agency who did not wish to be named on the issue.

Total deposits in PMJDY accounts amounted to ₹86,320.79 crore as on December 26, 2018, and 26.87 crore Rupay debit cards have been issued under the scheme.