Jan-Dhan juggernaut: 24 lakh beneficiaries added in July

The financial inclusion juggernaut gathered force with as many as 24 lakh new individuals being added to the list of Jan-Dhan beneficiaries till the end of July, government data show. The addition pushed the tally up to 42.83 crore from 42.59 crore at the end of June – a rise of 0.56%.

However, despite the addition to the beneficiaries, there was a net outflow of Rs 1,208 crore from the cumulative corpus of the Jan-Dhan accounts. At the end of July, the total outstanding in these bottom-of-the-pyramid accounts stood at Rs 142,948.46 crore, down from Rs 144,156.46 crore.

Net outflow in June

Incidentally, in June too, there was a net reduction in the balance of Rs 1,575 crore from the total deposit of Jan-Dhan accounts though as many as 17 lakh new beneficiaries were enrolled during the month when restrictions began easing and economic activity began picking up after the second Covid wave.

Though the number of beneficiaries under the programme was on the rise, July also displayed a steady decline in one crucial parameter, that of coverage of ATM-cum-debit cards. There was a decline in the share of beneficiaries who were issued debit cards that equip them to utilise ATMs and make online payments and purchases.

Steady drop

In July, the total number of debit cards issued stood at 311,221,421 and the total number of beneficiaries was at 428,342,620. Therefore, the percentage of Jan-Dhan account holders who were issued debit cards stood at 72.65%.

At the end of June, this coverage stood at 73.01% — a total of 310,965,964 cards were issued to 425,876,394 beneficiaries.

At end-May, 73.07% of the beneficiaries had debit cards.

At the end of the previous financial year, on average, 73.22% of the beneficiaries had debit cards. It dipped to 73.17% at the end of April.

Wide disparity

Among the states and union territories, there is a wide disparity in the share of the Jan-Dhan beneficiaries who have debit cards.

At the end of FY21, about 90% of the beneficiaries of Jan-Dhan accounts in Ladakh had debit cards while only 35.14% had it in Manipur.

Rs 1.43 lakh crore

According to data the cumulative deposit in Jan-Dhan accounts stood at Rs 142,948.46 crore. It was Rs 1,208 crore (or 0.83%) less than the balance of Rs 144,156.46 crore at the end of June.

This was Rs 1,575 or 1.09% down from the outstanding amount at the end of May.

PSU banks

Of the total beneficiaries as many as 338,449,446, or 79.01%, were registered with public sector banks at the end of July.

The rest were split between regional rural banks (18.03%) and private sector banks (2.94%).

Since August 2014

Launched in August 2014 for the bottom of the financial pyramid, the Pradhan Mantri Jan Dhan accounts are a quantum leap in the direction of financial inclusion. From an account for every family, the new target is opening a bank account for each adult.

These accounts can be opened in public sector banks, regional rural banks, and private sector banks.

One of the most important immediate collateral benefits was the establishment of a system where direct cash transfers reached the intended targets without any leakage.