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Pradhan Mantri Jan Dhan Yojana

Last Update Date : April 29, 2019
Estimated Read Time: 11 min

pradhan mantri jan dhan yojana

India being most populated and diversified country where more than half of its population is below the poverty line, there was an exigent need to introduce measures which would directly provide benefits and subsidies to the poor and needy people. As the good things come to those who wait. The government enforced the most powerful scheme on 28 August 2018 widely known as Pradhan Mantri Jan Dhan Yojana to provide bank account facilities to each and every household in the country. This deep penetration at an affordable cost is possible only with the effective use of technology. Let us discuss in depth about the scheme in this guide by H&R Block.

What is Pradhan Mantri Jan Dhan Yojana?

Prime Minister Narendra Modi on 28 August 2014 launched highly striving scheme widely known as Pradhan Mantri Jan Dhan Yojana (PMJDY) which is a substantial project of NDA government and envisages to open at least one bank account in every household in the country. The main objective of this scheme is ensuring easy access to various financial services like availability of basic savings bank account, access to need-based credit, remittances facility, insurance and pension to the weaker sections & low-income groups especially to the poor and needy sections. Bank Account in this scheme can be opened in any bank branch or Business Correspondent (Bank Mitr) outlet. Usually accounts opened under PMJDY are with Zero balance. According to the data issued by the finance ministry, till date 31.60 Crore beneficiaries’ bank accounts have been opened and ₹81,203.59 Crore Balance in beneficiary accounts.
This is major scheme proves to be iron hand in dealing with corruption as the benefit and other subsidies will be directly credited to your account without any mediator or corrupt person in between and will help in the upliftment of poor and boost development of the country economically and socially.

What are the Benefits of Pradhan Mantri Jan Dhan Yojana (PMJDY)?

The scheme is particularly implemented for the betterment of poorer and backward sections of the society. PMJDY is a National Mission incorporating an integrated approach to bring about the comprehensive financial inclusion of all the households in the country. The main benefits are described below:

Loan Benefits

  • An account holder under the PMJDY scheme can enjoy the benefit of taking a loan up to Rs 5,000 from a bank after six months from opening the account.
  • This feature is available especially for those who are below the poverty line.
  • The amount received as loan can be invested in various other areas, especially in agriculture or farming.
  • The borrower can also increase the loan about depending on his repayment tenure.
  • The tenure of a loan under this scheme is 36 months.
  • The loan comes with zero processing fees.

Mobile Banking Benefits

  • The PMJDY scheme is easy and convenient as it comes with mobile banking benefits also.
  • Any account holder can check and transfer balance by using a normal cell phone. Since buying a normal cell phone is quite affordable, the majority of people can avail this scheme.

Insurance Benefit

The account holders of PMJDY scheme can avail insurance accidental life cover and life cover benefits. The scheme enables them to enjoy life accidental life insurance coverage of Rs 1,00,000 and life insurance coverage worth Rs 30,000.

Special Benefits

  • The accounts opened under PMJDY are zero balance accounts. The account holder does not have to maintain any minimum balance under this account.
  • Account holders would receive Rupay Kisan Debit Cards to withdraw money from ATM’s as and when they need.
  • Account holders get striking interest on their deposit.
  • Account holder does not have to keep any minimum balance to continue the account.
  • The scheme allows you to transfer money easily across India.
  • The scheme allows Direct Benefit Transfer for beneficiaries of Government Schemes.
  • Account-holders can get easy access to pension and other insurance products with the PMJDY scheme.
  • Overdraft facility up to Rs 5,000 is available in only one account per household, preferably lady of the household.

Overdraft Facilities and Benefits under PMJDY

Overdraft facility generally allows the customers to withdraw money from their account even when they have zero balance in the account. As already discussed, the account holder can avail the overdraft facility from an account under the Pradhan Mantri Jan Dhan Yojana scheme. The overdraft facility even helps when you have given a cheque of Rs 2,000 to someone but you have zero balance in your account. During such a time, your cheque won’t bounce due to the overdraft facility. Overdraft also helps when ATM withdrawals are made during an emergency without knowing the balance in the debit card.

  • The overdraft facility is offered to account holders under the scheme.
  • An overdraft facility of Rs 5,000 is available to any one account holder per household. This means that only one member of a particular family can avail the overdraft facility. Usually, female members are favoured for the overdraft facility.
  • The facility will be available and can be used by the customer only after six months from the date of the opening of the account under the scheme.
  • The account holder should have a good transaction record to avail this facility.
  • The account holder should also have a good credit history.
  • There is a nominal interest rate that is charged to the account holder on availing the facility of overdraft. Usually, the interest rate in India is between 12% p.a. to 20% p.a. which is set by the banks.

Who offers PMJDY Scheme?

Generally, banks and Business Correspondent outlets provide this bank account scheme under Pradhan Mantri Jan Dhan Yojana. The list of banks are given below:

Private Banks

  • HDFC Bank Ltd.
  • ICICI Bank Ltd.
  • YES Bank Ltd.
  • Karnataka Bank Ltd.
  • Kotak Mahindra Bank Ltd.
  • Axis Bank Ltd.
  • Dhanlaxmi Bank Ltd.
  • Federal Bank Ltd.
  • IndusInd Bank Ltd.
  • ING Vysya Bank Ltd.

Public Sector banks offering PMJDY

  • Andhra Bank
  • Bank of Baroda (BoB)
  • Bank of India (BOI)
  • Allahabad Bank
  • Vijaya Bank
  • Central Bank of India
  • IDBI Bank
  • Syndicate Bank
  • Punjab National Bank (PNB)
  • Union Bank of India
  • Indian Bank
  • Corporation Bank
  • Bank Of Maharashtra
  • Canara Bank
  • Oriental Bank of Commerce
  • Punjab & Sind Bank
  • Bhartiya Mahila Bank
  • Dena Bank
  • State Bank of India (SBI) and all its 5 affiliated banks which include – State Bank of Hyderabad, State Bank of Mysore, State Bank of Bikaner & Jaipur, State Bank of Travancore and State Bank of Patiala.

NOTE: The government of India has allowed these private and public banks to conduct special camps on Saturdays from 8 am to 8pm to help people open bank accounts under PMJDY.

Eligibility Criteria to Open an Account under Pradhan Mantri Jan Dhan Yojana?

In order to enjoy the benefits under this scheme you need to satisfy the following criteria:

  • Any individual with an Indian nationality is eligible to open a bank account under the Pradhan Mantri Jan Dhan Yojana scheme.
  • Minors are also eligible to open bank accounts under PMJDY. Minors are also eligible to get RuPay Card which they can use 4 times in a month to withdraw cash.
  • Individuals who do not have any valid document to support their Indian nationality. Banks even allows them to open bank accounts under PMJDY, once they do a ground research on them and usually categories them as “low risk” individuals.
  • A person with an existing savings bank account can transfer his/her account to account to Pradhan Mantri Jan Dhan Yojana account so as to enjoy the benefits of PMJDY scheme.

NOTE: The minimum age limit for a minor is 10 years. Otherwise, any Indian resident over the age of 18 years is eligible to open this account. Income is not a bar to open a PMJDY account, although it is primarily meant for the poor section. An individual needs to exit scheme on after reaching the age of 60 years.

Documents Required to Open an account under PMJDY

An account can be opened by presenting an officially valid document mentioned below:

  • the passport,
  • the driving licence,
  • the Permanent Account Number (PAN) Card,
  • the Voter’s Identity Card issued by Election Commission of India,
  • job card issued by NREGA duly signed by an officer of the State Government,
  • the letter issued by the Unique Identification Authority of India containing details of name, address and Aadhaar number, or
  • any other document as notified by the Central Government in consultation with the Regulator
  • In the absence of a valid identity proof, a person can submit an authority letter issued by a gazette officer stating that the individual is a resident of India.
  • If an individual fails to provide any address proof, then bank can do a primary check of the individual. If the bank certifies that the individual is a “low risk individual”, he/she can open a bank account for 12 months. The account becomes a temporary account which can be converted into a permanent one by submitting required documents before completion of 12 months.

Pradhan Mantri Jan Dhan Yojana Rules and Regulations for Life Cover

The PMJDY offers a life cover of Rs 30,000 to the family members, in case the life assured dies. This benefit can be enjoyed by those subscribers who opened their bank accounts under PMJDY from 15th August 2014 to 26th January 2015. An account holder needs to fulfil the following conditions to avail the benefit of life cover:

  • The account must have been opened between 15-08-14 to 26-01-15 and it should be first account opened by a person.
  • The account holder should belong to the age group of 18 to 59 years and he/she should be the head of the family or a source of income.
  • If the family head is more than 60 years old, the second earning member of the family shall be covered for this benefit.
  • The beneficiary should have a RuPay Card and Biometric Card linked to the bank account.
  • The RuPay Card should be valid at the time of availing this benefit.
  • Only a single person shall be entitled to enjoy the coverage. If a person of the same family has multiple accounts or cards, benefits will be calculated based on one card or account.
  • The life cover offered under PMJDY will be effective for a period of 5 years that is till the end of the financial year 2019 and 2020. After this, the scheme will be reviewed and certain terms and conditions might change.

Claim Settlement Procedure for Life Cover under PMJDY

As per the claim settlement procedure set by the PMJDY, a person needs to adhere to the following norms:

  • An amount of Rs 30,000 is payable to the account holder following the death of the account holder. The amount will be paid to persons falling in the age group of 18 to 60 years.
  • The Nodal branch or district branch of the concerned bank will collect the claim papers and submit them to the Pension and Group Scheme Unit of LIC for processing it further.
  • The claim will be paid to the nominee listed in the bank account.
  • The nominee will receive the claim in his/her bank account directly through NEFT or APBS.

Details to be Included in PMJDY Application Form

The following details you need to include in the application form of PMJDY:

  • The first section of the application form contains your personal details such as your name, state, village/town and the name of the branch.
  • The second part of the application form includes your full name, date of birth, occupation, contact numbers, your MNREGA job card number, Aadhaar Card number, father’s name, marital status, annual income etc.
  • It also includes the details of your assets and the number of dependents you have and whether you want a RuPay Card or not.
  • You also need to include your nominee details in the application form wherein you need to include the name of the nominee, relationship with your nominee, date of birth and person authorized to receive the amount on behalf of the nominees.
  • Also, a recent photograph of yours, not older than six months should be attached with the application form.
  • There is also a column for self-declaration by the applicant.

Download Application Form for Jan Dhan Yojana Bank Account

Follow the steps to download the form and fill the form and apply for a Jan Dhan account at a bank of your choice:

  • For those who want to download the form in English or Hindi, visit this page – http://pmjandhanyojana.co.in/download-account-opening-form-hindi-english/
  • Once you have got the application for a Jan Dhan account, fill in the required personal details that will be stated against your bank account in the future:
    1. Name of the account holder
    2. Address of the account holder
    3. Occupation
    4. Annual income of the account holder
    5. Existing bank accounts of any family members (optional)
    6. Kissan credit card number (optional)
  • The next step is to mention the name of the bank that you wish to open your account with. Example: State Bank of India, Punjab National Bank, etc. While doing so, mention the IFSC code of the bank.
  • With regard to the bank that you have chosen to open your Jan Dhan account with, fill in the following details:
    1. Name of the bank
    2. Village or town of the bank branch
    3. Sub district/ block name of the bank branch
    4. District it falls under
    5. State the bank branch is situated in
    6. SSA code/ward number
    7. Village code or town code
  • Tick on the option of receiving a Rupay card when the bank account has been opened.
  • Along with the application, the subscriber has to submit the following documents for address and identification proof:
    1. PAN card
    2. Voter’s ID card
    3. Ration card
    4. Aadhaar card
    5. Any government ID proof
    6. Electricity bill (For address proof)
    7. Water bill (For address proof)
    8. Gas connection bill (For address proof)
  • Once you have successfully used the account for a period of 6 months, one is eligible for an overdraft amount of Rs 5,000 from the government.

How is this Scheme Different from Other Schemes?

PMJDY aims to include every household under its goal of financial inclusion whereas the Swabhimaan scheme included the villagers. The Swabhimaan scheme targeted villages with population exceeding 2,000 while under PMJDY whole country is to be covered by extending banking facilities to the families living in the villages and urban areas. Thus, under PMJDY, any individual irrespective of his/her area can get a bank account without depositing any amount and fulfilling the required eligibility criteria.

Toll-free Numbers

For those citizens having queries regarding the Pradhan Jan Dhan Yojana scheme, or have doubts related to the processes of the scheme, the government has set up dedicated toll-free numbers to clear all doubts. The toll-free numbers are – 1800 110011 and 1800 180 1111.

Frequently Asked Questions

1. What is BSBDA account?

Ans: BSBDA stands for Basic Savings Bank Deposit Account. It is a basic savings account defined under the Reserve Bank of India circular dated 10.8.2012

2. What is Rupay Debit card?

Ans: It is a domestic debit card introduced by the National Payment Corporation of India. The RuPay Debit Card is accepted at all ATMs for withdrawing cash and POS machines for making cashless payment for purchases. The card is accepted across the country.

3. When can a person exist from this scheme?

Ans: One can exist when he/she attains 60 years of age.

4. Is this scheme available in any other language?

Ans: Yes. It is available in Hindi.

5. Can I open a joint account under this scheme?

Ans: Yes, you can definitely open a join account.

6. If I am illiterate customer can I still get issued a Rupay Card to me?

Ans: Yes, bank will issue you a RuPay Card. The concerned bank person will inform you all related risks involved in using the RuPay Card, and how to use it and keep it safe.

7. Can I link my mobile number with my bank account opened under this scheme?

Ans: Yes, you can link your mobile number with your bank account. You can do so by contacting your bank where you have opened your bank account under PMJDY. Bank will enter your mobile number in the CBS system based on the information provided by you.

8. What is small Account or Chota Khata under PMJDY?

Ans: A small account is a kind of bank account opened under PMJDY for 12 months. A small account can be opened by a person who does not have valid documents to open an account. However, after 12 months, the account holder needs to submit required documents to continue the account.

9. How much Interest will I receive on my savings account?

Ans: Normally, the applicable rate of interest is 4%. However, it is subject to change.

10. What is Bank MITR?

Ans: Bank Mitr refers to the business correspondents agents who provide banking services at select locations. The Bank Mitr represents the bank and helps it expand its outreach. It offers banking services at low cost at areas where establishing a brick and mortar branch is not feasible. Retired Bank Employees, Retired Teachers, Retired Government Employees and Ex-Servicemen can join as a Bank Mitr.

11. Can I get cheque book issued under PMJDY?

Ans: Usually, the accounts opened under PMJDY are Zero balance accounts. If an account-holder wishes to get cheque book, he/she will have to fulfil the minimum balance criteria required by a bank.

12. Is the bank account opened under PMJDY transferrable? What if I want to transfer my account to one city to another or one state to other?

Ans: Yes, you can easily transfer your account from one city/state to another as all banks offering bank accounts have core banking solutions. You can do this by simply requesting the bank.

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Chetan Chandak (B.Com, LLB)
Chetan is the Head of Tax Research at H&R Block (India) with an experience of more than a decade in tax advising. He is also a regular contributor for some of the leading news publications in India such as Economic Times, Financial Express and Money Control. Professionally, Chetan is fascinated by international taxation and expat-related tax research.

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