The Other Side of Jan Dhan: Understanding Inoperative Accounts

The Indian government’s commitment to financial inclusion has been prominently showcased through the Pradhan Mantri Jan Dhan Yojana (PMJDY), an ambitious scheme aimed at ensuring universal banking access. However, recent data presented to the Rajya Sabha by Bhagwat K Karad, Minister of State for Finance, highlights a crucial aspect of this journey: the inoperativeness of a significant portion of these accounts.

Detailed Overview of the Current Scenario:

  1. Extent of Inoperativeness:
    • As of December 6, 2023, nearly 20% of the 511.1 million (51.11 crore) PMJDY accounts were reported as inoperative. This translates to about 103.4 million (10.34 crore) accounts.
    • Among these, 49.3 million (4.93 crore) accounts are held by women.
    • The cumulative balance in these inoperative accounts stands at approximately Rs 12,779 crore, which constitutes around 6.12% of the total deposited balance in PMJDY accounts​​​​.
  2. Comparison with the Broader Banking Sector:
    • The proportion of inoperative accounts under PMJDY is consistent with the general banking sector’s pattern, indicating a systemic issue rather than a scheme-specific one.
    • The inoperative accounts under PMJDY are not an anomaly but reflect widespread banking behaviors across India​​​​.
  3. Trends and Improvements:
    • There has been a notable decline in the percentage of inoperative accounts from 40% in March 2017 to 20% in November 2023.
    • This reduction is the result of various initiatives by banks and the government to foster active banking practices among account holders​​.
  4. Mechanisms for Account Reactivation:
    • Accounts become inoperative or dormant when there are no customer-induced transactions for over two years, following guidelines set by the Reserve Bank of India (RBI).
    • Account holders can reactivate their accounts at any time without incurring fees by completing the necessary KYC procedures.
    • The inoperative accounts continue to accrue interest at rates applicable to operative accounts, and the funds remain accessible to the depositors once the accounts are reactivated​​​​.
  5. PMJDY: A Pillar of Financial Inclusion:
    • The scheme has been instrumental in providing at least one basic banking account for every household, significantly improving financial access.
    • As of the latest data, PMJDY has led to the issuance of 347.1 million RuPay cards and a total deposit accumulation of Rs 2,08,637.46 crore in beneficiary accounts.
    • PMJDY’s success is not just in numbers but also in its role in fostering a more financially inclusive environment across the country​​.

Government and Banking Sector Initiatives:

The Indian government, along with the banking sector, is intensifying efforts to reduce the number of inoperative accounts. This involves:

  • Organizing awareness camps at local levels to educate people about good banking habits.
  • Regular monitoring of account activities by the government to ensure continued progress.
  • Banks are undertaking efforts to make banking more accessible and customer-friendly, encouraging regular transactions and account maintenance.

Future Outlook:

The reduction in the percentage of inoperative accounts indicates a shift towards more active financial engagement by the populace. The government’s continuous efforts to educate and encourage the use of banking facilities, combined with the convenience and security offered by PMJDY accounts, are expected to further decrease the number of inoperative accounts. The PMJDY, thus, remains a cornerstone in India’s journey towards comprehensive financial inclusion, creating a foundation for a more economically empowered society.

Share:

MORE STORIES

## Navigating the AI Revolution: 5 Trending Google Ads Topics for Marketers As Google Ads continues its rapid evolution, staying ahead of the curve is paramount for digital marketers. The platform’s increasing reliance on artificial intelligence, shifting privacy landscapes, and the introduction of new campaign types are creating a fresh set of challenges and opportunities. Here are five top trending blog topics that delve into the most critical areas of Google Ads today. ### 1. The Rise of the Machines: Mastering AI-Powered Campaign Types Google is unequivocally betting on AI to drive the future of its advertising platform. A key area of focus for marketers is understanding and mastering AI-driven campaign types like Performance Max and Demand Gen. These campaigns automate targeting, bidding, and ad creation across Google’s entire inventory. A deep dive into strategies for providing the right inputs to these “black box” models, interpreting their performance, and understanding how to guide the AI for optimal results is a crucial topic for advertisers looking to succeed in this new era. ### 2. Beyond the Click: Navigating the New Landscape of Measurement and Attribution With the impending deprecation of third-party cookies and a growing emphasis on user privacy, the way advertisers measure success is undergoing a fundamental shift. This has propelled topics like enhanced conversions, consent mode, and the integration of first-party data to the forefront. Marketers are actively seeking guidance on how to implement these privacy-centric measurement solutions to gain a more accurate and holistic view of their campaign performance in a world without granular user tracking. ### 3. Creative is the New Targeting: Leveraging AI for Compelling Ad Experiences In an automated world, the creative has become a key differentiator. Google is investing heavily in AI-powered tools that can generate and optimize ad copy, images, and videos. Blog posts that explore how to effectively use these generative AI features to create a high volume of diverse and engaging ad creatives are gaining significant traction. This includes best practices for providing creative inputs, A/B testing AI-generated assets, and ensuring brand consistency across automated campaigns. ### 4. The Evolution of Search: Adapting to a More Conversational and Visual SERP The traditional keyword-based search is evolving. Users are increasingly employing longer, more conversational queries, and Google is responding with a more visual and AI-driven search engine results page (SERP). This shift requires a re-evaluation of traditional keyword research and bidding strategies. Trending discussions revolve around how to adapt to this new reality, including the role of broad match keywords, the importance of high-quality creative in visual search formats, and strategies for capturing intent in a more conversational search landscape. ### 5. Future-Proofing Your Strategy: The Growing Importance of a Full-Funnel Approach As automation takes over many of the manual levers within Google Ads, the focus is shifting towards a more strategic, full-funnel marketing approach. Advertisers are looking for insights on how to effectively use different Google Ads campaign types to guide users through the entire customer journey, from initial awareness to final conversion and retention. This includes discussions on how to structure campaigns to complement each other, allocate budgets across the funnel, and measure the impact of upper-funnel activities on bottom-line results.

Google Ads is in the midst of a quiet revolution—one driven by artificial intelligence, privacy-first regulations, and a rapidly changing search landscape. For digital marketers,

Send Us A Message