Pradhan Mantri Jan Dhan Yojana

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Pradhan Mantri Jan Dhan Yojana (Prime Minister’s People Money Scheme) is a scheme for comprehensive financial inclusion launched by the Prime Minister of India, Narendra Modi on 28 August 2014. He had announced this scheme on his first Independence Day speech on 15 August 2014.


“Banks were nationalised in 1969 after weaving a lot of dreams before the country. We were told that this would benefit the poor. But I regret to say that in reality, even after 68 years of independence, not even 68 per cent of the population is covered by the banking system. This is also a form of untouchability,” said Modi.

This scheme Run by Department of Financial Services, Ministry of Finance, on the inauguration day, 1.5 Crore (15 million) bank accounts were opened under this scheme. By 10 January 2015, 11.76 crore accounts were opened, with around INR8698 crore (US$1.4 billion) were deposited under the scheme, which also has an option for opening new bank accounts with zero balance.

The Jan Dhan Yojana provides for a free zero-balance bank account with a debit card, Rs 1 lakh accidental insurance policy and Rs 30,000 free medical insurance cover for those who enroll before January 26. Depending on the performance of the accounts in the first six months, banks will later extend a Rs 5,000 overdraft facility, thereby turning the debit card into a kind of credit card. In next phase, micro insurance & pension etc. will also be added.

The debit card is being issued by RuPay of the National Payments Corporation of India. Modi said a mammoth initiative like this would go a long way in granting global acceptance to the RuPay brand, in line with international retail credit giants like Visa and others.

Launching his government’s first big ticket social welfare programme, the Pradhan Mantri Jan Dhan Yojana, Prime Minister Narendra Modi  gave a call for eradicating what he termed as “financial untouchability” of the poor by opening at least one bank account for every family in the country in less than six months.

Under the scheme

  1. Account holders will be provided zero-balance bank account with RuPay debit card, in addition to accidental insurance cover of Rs 1 lakh (to be given by ‘HDFC Ergo’) which is now increased to Rs 2 lakh.
  2. Those who open accounts by January 26, 2015 over and above the 1 lakh ₹ accident, they will be given life insurance cover of Rs 30,000(to be given by LIC).
  3. After Six months of opening of the bank account, holders can avail 5,000 ₹ overdrafts from the bank. The limit is now increased to Rs 10,000.
  4. With the introduction of new technology introduced by National Payments Corporation of India (NPCI), a person can transfer funds, check balance through a normal phone which was earlier limited only to smart phones so far.
  5. Mobile banking for the poor would be available through National Unified USSD Platform (NUUP) for which all banks and mobile companies have come together.


  1. Anti-welfare Economics: As the guidelines of Pradhan Mantri Jan Dhan Yojana do not keep any chapter for the criteria to be a beneficiary under the said scheme BPL as well as APL are also taking the benefit . Thus Pradhan Mantri Jan Dhan Yojana is anti- welfare economics.
  2. Violation of Article 39( c) of the Constitution of India: Pradhan Mantri Jan Dhan Yojana violate Article 39( c) of the Constitution of India which says that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment. The reason for this is that above poverty lines are also taking the benefit of the said scheme.

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