Pradhan Mantri Jan Dhan Yojana: Aim, Benefits, Features & Eligibility

The Pradhan Mantri Jan Dhan Yojana (PMJDY) is a financial inclusion mission launched by Prime Minister Narendra Modi. It aims to provide countless unbanked Indian citizens access to mainstream financial services.

Read on to learn more about Pradhan Mantri Jan Dhan Yojana’s online application procedure, the eligibility criteria and more!

What is PMJDY?

The objective of Pradhan Mantri Jan Dhan Yojana is to remove financial untouchability and ensure financial inclusion. It allows people from underprivileged communities to open a savings bank deposit if they don’t have one. From banking/savings & deposit accounts to credit, remittance, pension and insurance – Jan Dhan subscribers can unlock a bunch of benefits with their accounts.

The scheme has not only set itself a noble goal but also consistently delivered on its promises. It was launched on 28 August 2014. As of October 2022, over 47 crore citizens were enrolled in the scheme. So, what attracts people to PMJDY in such large numbers?

Let us now dive deep and understand. 

PM’s Jan Dhan Yojana Scheme – Basic Information

Here’s a snapshot of the features of the PM’s Jan Dhan Yojana Scheme: 

How Does Pradhan Mantri Jan Dhan Yojana Work?

• Opening Accounts: The PMJDY helps people open a basic savings bank account, especially those who don’t have one yet.
• RuPay Card: Each account holder is provided with a RuPay debit card, which also offers an accident insurance cover of up to Rs. 2 lakh for new accounts opened after 28.8.2018.
• Getting Government Help: If the government gives any money or help, it goes straight into these accounts.
• Small Loan Facility: Some people can borrow a small amount of money from their account if needed.
• More Financial Help: People can get insurance, pensions, and loans with this account.
• Learning About Money: PMJDY teaches people about banks, money, and other important things.
• Easy Transactions: People can use mobile phones to do banking. This helps those in areas without good internet.
• No Minimum Balance Requirement: You don’t need to keep a certain amount of money in the account. This provides more user-friendliness to the masses.

Aims & Objectives of Pradhan Mantri Jan Dhan Yojana (PMJDY)

Pradhan Mantri Jan-Dhan Yojana (PMJDY) is a national initiative aimed at achieving total financial inclusion in India. Its primary objective is to provide all households, especially the weaker sections and low-income groups, with access to a range of financial services at an affordable cost. This includes:

1. Universal Banking Access: Every household should have at least one basic banking account.
2. Financial Literacy: Promote awareness and understanding of financial products, services, and their benefits.
3. Credit Access: Provide need-based credit facilities.
4. Insurance & Pension: Introduce insurance and pension facilities to these account holders.
5. RuPay Debit Card: Account holders receive a RuPay debit card that comes with an accident insurance cover of up to Rs. 1 lakh (enhanced to Rs. 2 lakh for accounts opened after 28.8.2018).
6. Direct Benefits Transfer: The scheme promotes transferring government benefits directly to beneficiaries’ accounts, eliminating intermediaries and ensuring transparency.
7. Overdraft Facility: Eligible account holders can avail of an overdraft facility up to Rs. 10,000.
8. Connectivity and Technology: Addressing technological challenges, such as poor connectivity, and leveraging mobile transactions to ensure wider reach.
9. Inclusion of Youth: Engaging the youth to participate actively in this mission.
10. Additional Financial Services: Account holders under PMJDY can access services like the Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), Pradhan Mantri Suraksha Bima Yojana (PMSBY), Atal Pension Yojana (APY), and MUDRA scheme.

Who is Not Eligible for Pradhan Mantri Jan Dhan Yojana?

The individuals to whom this scheme does not apply include those who have a bank account already, individuals under the age of 10, and Non-citizens of India.

How to Open a Jan Dhan Account?

To open a PM Jan Dhan Yojana Account, you need to follow the mentioned steps:

1. Download the PMJDY form from Pradhan Mantri Jan Dhan Yojana’s website. Alternatively, you may collect it from the nearby bank branch.

2. Submit the form and supporting documents to open the Jan Dhan Yojana account. You have to visit the bank branch and submit the required documents. Complete the KYC form and submit it for verification.

3. After the verification, your PMJDY account will be activated.

*Note: Appointing a nominee is crucial. It will ensure that the money gets transferred to your contender in case of the account holder’s untimely demise. 

Also Read: Best High Risk Mutual Funds to Invest in 2023

Eligibility Criteria for a Jan Dhan Yojana Account

Since this scheme aims to bring millions of unbanked citizens into the mainstream financial system, the eligibility criteria are highly inclusive. You need to fulfil the following conditions to open a PMJDY Account:

• Applicants must be citizens of India.
• They must be at least 10 years old.
• They must not have another bank account registered in their name.

Documents Required to Open a Jan Dhan Yojana Account

To open a Pradhan Mantri Jan Dhan Yojana Account, you need the following documents:

1. If the applicant has an Aadhar card or number, they won’t require any other document. However, if the official address of the applicant has changed, self-certification of the present address is mandatory.
2. If an applicant does not have an Aadhar card, they can apply using any of the below documents:

• PAN card
• Voter ID card
• Passport
• Driving licence
• NREGA

If you do not have the above-listed documents and the banks categorise them as low-risk, you can apply for a PMJDY account using any of the following documents:

1. An ID card with the applicant’s photo issued by Government departments (Central or state), regulatory/statutory bodies, public financial institutions, commercial banks and public sector undertakings.
2. A letter from a gazetted officer that contains a duly-attested photo of the applicant

Benefits of the Jan Dhan account 

The Pradhan Mantri Jan Dhan Yojana offers the following benefits:

1. The scheme provides Accident Insurance worth Rs.1 lakh. However, it is revised to 2 lakhs for the PMJDY accounts opened after 28-08-2018.
   A claim under personal accidental insurance for PMJDY will be payable only if the RuPay cardholder has performed a successful RuPay card-related financial transaction within 90 days preceding the accident.
2. Under PMJDY, you will receive a RuPay debit card free of charge. You can use the card at ATMs, online merchants, and point-of-sale machines.
3. Like all savings schemes, you can earn interest on your deposits. However, it must be remembered that the PMJDY  will be subject to the interest rate of a savings bank account.
4. Government program beneficiaries will receive direct payments in their Jan Dhan accounts.
5. You may obtain an overdraft of up to Rs 10,000. However, this only applies to one account per household. Accounts are eligible for overdraft after a satisfactory operation for six months.
6. You can transfer funds at any time using your PMJD account.
7. You do not need to deposit a minimum amount or maintain any balance. However, if you wish to get a chequebook, you must fulfil the bank’s minimum balance criteria, if any. 
8. Pradhan Mantri Jan Dhan Yojana provides financial services to rural communities and underprivileged people, bringing them into banking services.
9. As a PMJDY account holder, you are eligible for the following government schemes:

• Atal Pension Yojana.
• Pradhan Mantri Jeevan Jyoti Bima Yojana.
• Micro Units Development & Refinance Agency Bank scheme.
• Pradhan Mantri Suraksha Bima Yojana. 
• Direct Benefit Transfer (DBT)

10. You can apply for the PM Jan Dhan Yojana online without hassles. This saves you the hassle of waiting in long queues at the bank.

Also Read: How to Deposit Money in Sukanya Samriddhi Account Online?

Life Cover under Pradhan Mantri Jan Dhan Yojana

Life cover is an important aspect discussed under financial schemes. Let’s take a look at the Life cover under PMJDY:

1. RuPay Debit Card with Insurance: Every PMJDY account holder receives a RuPay Debit Card. This card has an inbuilt accidental insurance cover of ₹1 lakh.
2. Life Insurance Cover: In addition to the accidental insurance, the Hon’ble Prime Minister, during the launch on 28th August 2014, announced a life cover of ₹30,000. This cover is available to those who opened a bank account with a RuPay debit card before 26 January 2015. This life insurance provides coverage against the death of the insured for any reason, and the amount is payable to the deceased’s family.
3. Target Audience and Premium Payment: The life insurance cover under PMJDY primarily targets families from the economically weaker sections. Recognizing that many from this segment cannot afford insurance, the scheme provides this cover to offer them a security net. Importantly, the premium for this life cover is borne entirely by the Government of India.

Claim Settlement Procedure of Life Cover under Pradhan Mantri Jan Dhan Yojana

If you’re between 18 and 60 years old, you’re covered with a life insurance amount of ₹30,000. Let’s take a look at the claim settlement procedure:

• Document Submission: After a holder’s demise, the bank where they had an account will gather the necessary documents: A copy of the death certificate of the deceased account holder. An attested copy of the Aadhar card of the deceased account holder. Any other relevant documents, such as a copy of the bank passbook or statement of account sent to a specific LIC office (known as the P&GS unit) for claim processing.
• Nominee’s Role: The insurance money is usually paid to the person the holder nominated in their bank account. If there isn’t a nominee or there are complications with the nominee’s status, legal heirs can claim the money by providing a special bond.
• Payment: Once approved, the insurance amount gets credited to the nominee’s bank account linked with their Aadhar card.
• Claims Direct to LIC: If someone sends a claim directly to LIC instead of the bank, LIC will coordinate with the bank for verification and then process the claim.

Rate of Interest for PMJDY Scheme

Many public and private sector banks offer the Pradhan Mantri Jan Dhan Yojana scheme. The interest rate on these savings accounts varies from bank to bank, ranging between 2.5% and 5%. Typically, public sector banks offer a higher interest rate. 

Banks Offering the  Pradhan Mantri Jan Dhan Yojana Scheme

Here is a list of public and private sector banks offering the PM’s Jan Dhan Yojana scheme:

Public Sector Banks offering PM’s Jan Dhan Yojana scheme: 

• State Bank of India 
• Bank of Baroda (BoB)
• Union Bank of India
• Punjab & Sind Bank
• Dena Bank
• Allahabad Bank
• Syndicate Bank
• Vijaya Bank
• Central Bank of India
• Punjab National Bank (PNB)
• Indian Bank
• IDBI Bank
• Corporation Bank
• Canara Bank
• Bank of India (BoI)
• Bank of Maharashtra
• Andhra Bank
• Oriental Bank of Commerce (OBC)

Private Sector banks offering  PM’s Jan Dhan Yojana scheme :

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

Final Thoughts

As a financial inclusion programme for the country’s underprivileged population, the PMJDY ticks many boxes. First and foremost, it introduces non-banked people, regardless of their income, to modern banking services. Secondly, you can open an account with zero balance and earn interest on the deposits. Lastly, the Jan Dhan account unlocks various benefits – from accident insurance to RuPay debit cards.

With crores of beneficiary banks, Pradhan Mantri Jan Dhan Yojana is undoubtedly promoting financial inclusivity one account at a time.

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