In this article, we cover the following:
1. What is Pradhan Mantri Jan Dhan Yojana (PMJDY)?
PMJDY is a nationwide scheme launched by the Government of India to ensure financial inclusion of every individual who does not have a bank account in India. This scheme aims at providing access to financial services, namely, Banking / Savings & Deposit Accounts, Remittance, Credit, Insurance, and Pension in an affordable manner to all. This scheme was launched in August 2014 and according to reports by the Ministry of Finance, around 4 crore bank accounts have been opened under this scheme till September 2014.
2. Who offers this scheme?
An individual can consider opening an account under this scheme with any bank branch or Business Correspondent (Bank Mitra) outlet. Further, accounts opened under PMJDY can be opened with Zero balance. However, if the account-holder wishes to get a cheque book, he/she will have to fulfill minimum balance criteria. The account holders under this scheme will be given a RuPay debit card which can be used across all ATMs for cash withdrawal.
3. What are the documents required to open an account under PMJDY?
An account under this scheme can be opened by presenting an officially valid document.
- The passport,
- The driving licence,
- The Permanent Account Number (PAN) Card,
- The Voter’s ID issued by Election Commission of India,
- The Aadhar Card;
- Any other document as notified by the Central Government in consultation with the Regulator:
Provided that where simplified measures are applied for verifying the identity of the clients, the following documents shall be deemed to be officially valid documents:—
- Identity card with applicant’s Photograph issued by Central/State Government Departments, Statutory/Regulatory Authorities, Public Sector Undertakings, Scheduled Commercial Banks, and Public Financial Institutions;
- A letter issued by a Gazetted officer, with a duly attested photograph of the person.
- In case, there is a change in the current address, you need to submit valid documents to transfer your account to the new address.
- Two passport size photographs are required.
- In case, a person does not have a valid residential address, he/she needs to submit a valid identity proof issued by the government of India.
Important to note that the Reserve Bank of India (RBI) has clarified in the year 2014 that those persons who do not have any of the ‘officially valid documents’ can open “Small Accounts” with banks.
A “Small Account” can be opened by a person on the basis of a self-attested photograph and putting his/her signatures or thumb print in the presence of officials of the bank. For such accounts, the aggregate credits have been limited to not more than Rs 1 lakh a year and aggregate withdrawals have been limited to not more than Rs 10,000 in a month, and balance in the account at any point of time should not cross Rs 50,000. The validity of these accounts is 1 year, normally after which such accounts would be allowed to continue for a further period of twelve more months if the account-holder provides a document showing that he/she has applied for any of the Officially Valid Document within 12 months of opening the small account.
4. What are the benefits of the PMJDY Scheme?
The account holders under this scheme will get an accidental insurance cover of Rs 1 lakh (enhanced to 2 lakh for new accounts opened after 28.08.2012) and a life cover of Rs 30,000 (if the account is opened between 15.8.2014 to 31.1.2015) – payment on the death of the beneficiary (subject to conditions).
The account holders under this scheme can avail an overdraft facility upto Rs 10,000. This is available against one account per household. The quantum of the loan may look small but definitely is a boon to those below the poverty line and would enable them to reinvest this in more profitable avenues.
Enabling carrying out transactions through a mobile phone facilitates such account holders in checking of balance and also transferring funds with ease across India.
The other benefits being:
- The account holders would be eligible for interest on their deposits
- They are not mandated to have a minimum balance in the account
- 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.