Introduction to Jan Dhan Yojana

  1. The Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched on August 28, 2014, by the Government of India.
  2. It aims to provide universal access to banking facilities and promote financial inclusion for all sections of society.
  3. Described as the world's largest financial inclusion initiative.

Objectives of Jan Dhan Yojana

  1. Provide access to basic banking services such as savings accounts, deposits, and withdrawals.
  2. Ensure access to affordable credit, insurance, and pension schemes.
  3. Facilitate direct transfer of government subsidies and benefits.
  4. Promote a cashless economy and reduce dependency on informal credit sources.

Key Features of Jan Dhan Yojana

  1. Opening of zero-balance bank accounts with a RuPay debit card.
  2. Provision of accidental insurance cover up to ₹2 lakh.
  3. Offers an overdraft facility of up to ₹10,000 after six months of account operation.
  4. Encourages mobile banking for financial transactions and services.
  5. Integration with government welfare schemes to enable Direct Benefit Transfers (DBT).

Achievements of Jan Dhan Yojana

  1. As of 2023, over 500 million accounts were opened under PMJDY.
  2. Increased access to formal banking systems in rural and remote areas.
  3. Reduction in leakages of government subsidies through DBT.
  4. Enhanced financial literacy among economically weaker sections.
  5. Boosted women empowerment by encouraging women to open accounts.

Challenges in Implementation

  1. Many accounts remain dormant due to lack of transactions.
  2. Low penetration of financial literacy in rural areas.
  3. Inadequate banking infrastructure and shortage of bank branches in remote locations.
  4. Technical issues in DBT processing and system integration.
  5. Reluctance of some users to adopt cashless modes of transactions.

Significance for Competitive Exams

  1. PMJDY is a key topic for exams like RBI Grade B, IBPS, SSC, NABARD, and UPSC.
  2. Questions may focus on its objectives, features, achievements, and challenges.
  3. Important statistics such as the number of accounts opened or insurance coverage under the scheme can be tested.

Relevance of PMJDY in Financial Inclusion

  1. Bridges the gap between formal financial institutions and underserved sections of society.
  2. Contributes significantly to achieving Sustainable Development Goal (SDG) 1 (No Poverty).
  3. Strengthens the financial ecosystem by promoting the use of digital and mobile banking.

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