All households across the country - both rural and urban are to be covered under the scheme. Bank accounts will be opened for 15 crore poor persons.

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1 A Critical Review of Progress of Prdhaan Mantri Jan Dhan Yojnaa (PMJDY) : State Level Variation (Yogesh Kumar, Joint Director, Institute of Applied Manpower Research, Planning Commission, Govt of India) In his first Independence Speech Prime Minister of India announced the National Mission on Financial Inclusion titled Pradhan Mantri Jan Dhan Yojna (PMJDY). Under the Jan Dhan Yojna anyone who is India citizen above age of 10 years and does not have a bank account, can open the account with zero balance. Account can be opened in any bank branch or Business Correspondent (Bank Mitr) outlet, specially designed for the purpose of opening the accounts under this scheme. The scheme also provides facility of accidental insurance cover up to rupees one lac without any charge for the account holder. The account holders under the jan dhan yojana will be given a RuPay debit card which can be used at all ATMs for cash withdrawal and at most of the retail outlets for making transaction for purchases. Salient features of the scheme All households across the country - both rural and urban are to be covered under the scheme. Bank accounts will be opened for 15 crore poor persons. All bank accounts opened under the scheme are to have an overdraft facility of Rs 5,000 for Aadhar-linked accounts after satisfactory operation in the account for 6 months. Issuance of RuPay Debit Card with inbuilt Rs 1 lakh personal accident insurance cover provided by HDFC Ergo and a life cover of Rs 30,000 provided by LIC A minimum monthly remuneration of Rs 5,000 to business correspondents who will provide the last link between the account holders and the bank. Implementation of the scheme The mission will be implemented in two phases, the details of which are as follows. Phase I - 15 August August 2015 Universal access to banking facilities for all households across the country through a bank branch or a fixed point Business Correspondent (BC) within a reasonable distance. To cover all households with atleast one basic banking account with RuPay Debit Card with inbuilt Rs 1 lakh accident insurance cover. Financial literacy programme to be taken to the village level. Expansion of Direct Benefit Transfer under various government schemes through bank accounts of the beneficiaries. Issuance of Kisan Credit Card is also proposed Phase II - 15 August August 2018 Providing micro-insurance to the people. Unorganised sector pension schemes like Swavalamban through the Business Correspondents. December, January, socio - economic voices

2 Benefits of Pradhan Mantri Jan Dhan Yojana PMJDY scheme is planning on revolutionizing the traditional banking system in India by providing the banking opportunity and insurance coverage to all including the poor. The purpose of this scheme will definitely benefit the overall economy of the country and the scheme provides some lucrative benefits which should certainly be availed and considered. Here is listed some important benefits of the Pradhan Mantri Jan Dhan Yojna (PMJDY) scheme 1. Life insurance under Pradhan Mantri Jan Dhan Yojana Under the PMJDY scheme the account holders will be given worth Rs insurance coverage if they comply with certain specification of the scheme which includes opening an account by January 26, 2015 and having an accidental insurance coverage of over Rs Loan benefits under Pradhan Mantri Jan Dhan Yojana The account holder can take loan benefit of up to Rs.5000 from the bank after six months from opening the account. Though the amount might seem insignificant for many but we have to realize the scheme is directed mostly towards people below the poverty line and who are struggling desperately to sustain their everyday living. 3. Mobile banking facilities under Pradhan Mantri Jan Dhan Yojana Though the technology of using smart phones to conduct our bank transactions is not novel anymore but the PMJDY scheme will allow its account holders to avail the same facilities of checking balance and transferring funds through a normal cell phone which is more affordable to the general economy. S.No Pradhan Mantri Jan - Dhan Yojana Accounts Opened As on (All Figures in Crores) No Of Accounts Rural Urban Total No Of Rupay Debit Cards Balance In Accounts (In Rupees Crores) 1 Public Sector Bank Rural Regional Bank Private Banks Total % of Zero Balance Accounts December, January, socio - economic voices

3 Important questions 1. Population Covered under PMJDY: Where do individual states stand? 2. Inequality of coverage: Percentage of population in the states vs Percentage of Accounts: Gini Coefficients Range Analysis : Inter states variations (deprivation) analysis : indicating efficiency of banking- mechanisms 3. How far the inclusive perspective of the Scheme been successful in terms of Coverage of rural populace in the country Coverage of people below poverty lines Percentage of population covered under the Scheme of PMJDY varies from state to state. Percentage of population Names of states covered Up to 10 per cent Kerala per cent Goa,, Himachal Pradesh, Jammu and Kashmir, and Tamil Nadu per cent Andhra Pradesh, Assam, Bihar, Gujarat, Jharkhand, Karnataka, Maharashtra, Odisha, Punjab, Uttar Pradesh, Uttarakhand, and West Bengal per cent Haryana, Madhya Pradesh, and Rajasthan per cent Chhattisgarh More than 45 percent All India per cent population covered December, January, socio - economic voices

4 States as arranged in terms of Population percent living in State vs PMJDY Accounts share in the State Major State percent of Population in the State Percent of Accounts in the states Percent Accounts - Gap Percent Pop Andhra Pradesh Assam Bihar Chhattisgarh Goa Gujarat Haryana Himachal Pradesh Jammu and Kashmir Jharkhand Karnataka Kerala Madhya Pradesh Maharashtra Odisha(Orissa) Punjab Rajasthan Tamil Nadu Uttar Pradesh Uttrakhand West Bengal * Includes also of Telengana Wide positive difference between the percentage share of accounts under the scheme from percentage share of population of the States (depicted above) indicate Madhya Pradesh, Chhattisgarh and Rajasthan seem to have taken a lead in adopting the scheme. On the other hand, the states of Maharashtra, Tamil Nadu, Bihar followed by Kerala seem to be lagging behind in terms of coverage of population as the negative directed bar chart in the graph indicates. Haryana, Andhra Pradesh and West Bengal too indicate a positive difference, depicting a more than average performance, while States of Gujarat, and Uttar Pradesh exhibit less than average negative. All other states do not differ much from zero, indicating that percentage share of accounts opened in those states are almost equivalent to the States share of population. December, January, socio - economic voices

5 Lorenz Curve 1 Taking clue from above graph, it is attempted to draw a kind of Lorenz curve comparing cumulative total of States Population vs. Accounts under PMJDY coverage while States are arranged in increasing order of percent population. A graphical representation of distribution representing the inequality among the population distribution as also the distribution of accounts could indicate the variation between the states, i.e. greater is the distance between two graphs more is the inter-state variations. As both the indicators indicate close proximity with small deviations, it warrants a deeper examination state-wise. As such it is also attempted to do a range analysis using the UNDP methodology comparing states population coverage under scheme with highest level of coverage of population in any state. While the actual differential of the state is numerator, denominator is maximum differential between two states. Gini Ratio The Gini coefficient (or Gini ratio) is a summary statistic of the Lorenz curve and a measure of inequality in a population. The Gini coefficient is most easily calculated from unordered size data as the "relative mean difference," i.e., the mean of the difference between every possible pair of individuals, divided by the mean size, (Dixon et al. 1987, Damgaard and Weiner 2000). Alternatively, if the data is ordered by increasing size of individuals, is given by 1 The Lorenz curve is a function of the cumulative proportion of ordered individuals mapped onto the corresponding cumulative proportion of their size. Given a sample of ordered individuals with the size of individual and, then the sample Lorenz curve is the polygon joining the points, where, 1, 2,...,, and. Alternatively, the Lorenz curve can be expressed as December, January, socio - economic voices

6 (Dixon et al. 1988, Damgaard and Weiner 2000), correcting the typographical error in the denominator given in the original paper (Dixon et al. 1987). Gini Coefiicient Values comes out to be 1. Gini For Accounts differential from Line of Equality = Gini For Population Differential from Line of Equality = The Net Differential in two Gini ratios is just This net differential of 2 per cent or so is unable to capture inter-state variations, as also making judgments with respect to relative performance differential Range Analysis: Another way of analysis as attempted by the UNDP comparing the states and their relative diiferentials from maximum and minimum attained amongst the States: The UNDP has developed a set of composite indices such as human development index (HDI), Human Poverty Index (HPI) and Gender related Development Index (GDI) for measuring the level of development and disparities among the countries in the world. Formula hence is Ax = (Actual Value)x (Minimum Value)x Bx= (Maximum Value)x (Minimum Value)x Rx= Ax/Bx Rx is the Range value of the State Level of Deprivation Percent of pop covered by PMJDY State/Union Territory Range Analysis 4 Andhra Pradesh Assam Bihar Chhattisgarh Goa Gujarat Haryana Himachal Pradesh Jammu & Kashmir Jharkhand Karnataka Kerala Madhya Pradesh Maharashtra Odisha(Orissa) Punjab Rajasthan Tamil Nadu Uttar Pradesh Uttrakhand West Bengal December, January, socio - economic voices

7 Difference is maximum in case of Kerala which means the percentage of population covered is minimum in the state. Next in terms of low coverage is Goa and Himachal Pradesh (relative deprivation level 7) followed by Tamil Nadu, Maharashtra, and J & K. (10-12 per cent coverage, and relative deprivation level 6). Relative deprivation level is 5 for Gujarat, Uttar Pradesh, Karnataka, Jharkhand, and Bihar. Andhra Pradesh, West Bengal, Assam, Punjab, Odisha and Uttarakhand have deprivation score of 4 performing better than the earlier discussed states. A much better coverage of population is found in Haryana and Rajasthan, while Madhya Pradesh has second highest coverage of population under the scheme. The best coverage with almost a third population covered vide the scheme is found in Chhattisgarh. Inclusive Growth As the scheme envisages to cater to the principle of inclusive growth covering hitherto uncovered sections of populace to be brought under the banking/saving and rightful coverage of unprotected segments, an attempt is made to look into (i) Rural as against urban populace (a) Percentage of Rural Accounts : Inter State Variations (b) Percent Rural vs. Percent Urban Accounts Sl No State Rural Accounts Percentage Urban Accounts Percentage Rural Accounts percent- Urban Accounts Percent 1 AP Assam Bihar Chattisgarh Goa Gujarat Haryana Himachal Pradesh Jammu and Kashmir Jharkhand Karnataka Kerala Madhya Pradesh Maharashtra Odisha(Orissa) Punjab Rajasthan Tamil Nadu Uttar Pradesh Uttrakhand West Bengal Total There is a large urban bias in the accounts opened so far, and hence the differential between rural and urban accounts range between (-) 31 and (-) 73 per cent. This is so despite in most of the states more than 50 per cent population live in rural areas December, January, socio - economic voices

8 (c) Hardly a fourth of the accounts opened under the Scheme are rural accounts (25.58 per cent). Almost threefourth accounts opened are in urban areas Sl No Rural Accounts percent Rural Population Per Cent Rank as per Rural Accounts percent Rank as per Rural Population Percent States 1 AP Assam Bihar Chattisgarh Goa Gujarat Haryana Himachal Pradesh Jammu and 20 9 Kashmir Jharkhand Karnataka Kerala Madhya Pradesh Maharashtra Odisha(Orissa) Punjab Rajasthan Tamil Nadu Uttar Pradesh Uttrakhand West Bengal Suppose we have a set of objects, which are being considered in relation to two properties, represented by and, forming the sets of values and. To any pair of individuals, say the -th and the -th we assign a -score, denoted by, and a -score, denoted by. The only requirement made to this functions is anti-symmetry, so and. Then the generalised correlation coefficient is defined by December, January, socio - economic voices

9 The Spearman correlation coefficient is defined as the Pearson correlation coefficient between the ranked variables. For a sample of size n, the n raw scores are converted to ranks, and ρ is computed from: where, is the difference between ranks. See the example below. Identical values (rank ties or value duplicates) are assigned a rank equal to the average of their positions in the ascending order of the values. With found, add them to find The value of n is 21. These values can now be substituted back into the equation : to give ρ = = with a P-value = 1.00 (using the t distribution) (d) Relationships between percent rural population and percent rural accounts per cent rural population, and percent rural accounts r t -test Tailed Type E Remarks A negative relationship indicates lots of efforts needed to bridge the gaps between the aims of the schemes, and its implementation in different states, particularly in rural areas. This clearly means states with more percent of rural population have lesser coverage of people under the scheme and vice versa. (e) A detailed review of state-wise positions on two fronts, i.e., percentage Population in Rural Areas vs percentage Population covered under PMJDY States < 15 % Accounts % With <50 % Rural pop % Goa % Tamil Nadu >35 % States % 60-70% 70-80% >80 % Total States Gujarat Kerala Maharashtra Uttarakhand West Bengal AP Haryana Karnataka Punjab All India J& K HP 2 Chhattisgarh Jharkhand Assam Bihar Odisha Rajasthan 6 Total MP UP December, January, socio - economic voices

10 Jammu and Kashmir and Himachal Pradesh despite having more than 70 per cent rural population have less than 15 per cent accounts opened in rural areas. Assam Bihar and Odisha too have between 25 to 30 per cent rural accounts, despite rural population in the States being more than 80 per cent. Chhattisgarh and Jharkhand have between 70 to 80 per cent rural population percent while percent rural accounts opened in the States are only between 25 to 30 per cent. Gujarat Kerala and Maharashtra have better coverage in rural areas, as in these States despite rural population account just about 50 to 60 per cent, and more than 35 per cent accounts are rural accounts. Tamil Nadu is another State with about 50 to 60 per cent rural population, and 30 to 35 per cent accounts being rural accounts. (ii) Coverage of populace in states having variety of Percentage of population below poverty line While in (i) attempt is made to highlight rural vs urban population coverage differentials across states, attempt is made to cover in (ii) the relative positions of the states with more percentage of population below poverty line vis-àvis the percentage of population covered under PMJDY. (a) Distribution of States with Respect to range of poverty levels Percentage of Population Below Poverty Line by States : (Tendulkar Methodology) Rural Urban Total State/Union Territory %age of Persons %age of Persons %age of Persons Andhra Pradesh Assam Bihar Chattisgarh Goa Gujarat Haryana H P J and K Jharkhand Karnataka Kerala M P Maharashtra Tamil Nadu Telangana Uttar Pradesh Uttrakhand West Bengal Total Notes: 1: Population as on 1st March 2012 has been used for estimating numbere of persons below poverty line (2011 Census extrapolated) Source: December, January, socio - economic voices

11 States (b) Distribution of States with range of poverty levels < 15 % Accounts % With <50 % Rural pop % Goa % Tamil Nadu >35 % States % 60-70% 70-80% >80 % Total States Gujarat Kerala Maharashtra Uttarakhand West Bengal AP Haryana Karnataka Punjab All India J& K HP 2 Chhattisgarh Jharkhand Assam Bihar Odisha Rajasthan 6 Total Jammu and Kashmir and Himachal Pradesh despite having more than 70 per cent rural population have less than 15 per cent accounts opened in rural areas. Assam Bihar and Odisha too have between 25 to 30 per cent rural accounts, despite rural population in the States being more than 80 per cent. Chhattisgarh and Jharkhand have between 70 to 80 per cent rural population percent while percent rural accounts opened in the States are only between 25 to 30 per cent. Gujarat Kerala and Maharashtra have better coverage in rural areas, as in these States despite rural population account just about 50 to 60 per cent, and more than 35 per cent accounts are rural accounts. Tamil Nadu is another State with about 50 to 60 per cent rural population, and 30 to 35 per cent accounts being rural accounts. MP UP 8 5 (c) A Comparative View of the two distributions, i.e. States in Different percentage class of Coverage under PMJDY vs Different percentage class of Poverty Levels R = P-value = (using the t distribution) TTEST (2 Tailed, Type1)= The r values indicate a positive correlation (despite relationship is not significant at 1 per cent level of confidence), which means as percentage of level of poverty in the states increases, states also have more percentage of people are covered under PMJDY. This thus reemphasise the concept of more inclusive growth and coverage of poor and deprived sections of population. d) A detailed review of state-wise positions on two fronts, i.e., percentage population below poverty line vs percentage population covered under PMJDY December, January, socio - economic voices

12 The analysis is carried out underneath to adjudge the performance of various States by categorising thee states. The two dimensions being -1. Percentage people below poverty lines in the State (along rows) and 2. The percentage share of accounts opened under the scheme by the state (along columns). Major States States in Various Levels of Poverty Least States in Different percentage class of Coverage of their Population under PMJDY Least <Avg Average > Avg Highest Kerala Goa H P, Tamil Nadu < Avg Gujarat J & K A P Punjab Haryana Rajasthan Uttarakhand Average Maharashtra Assam Karnataka W Bengal > Avg U P Highest Bihar Jharkhand Odisha M P Chhattisgarh Remarks Kerala has least percentage of population covered under PMJDY and have least level of poverty too. Other states having least levels of poverty are HP Tamil Nadu and Andhra Pradesh. While HP and Tamil Nadu had less than average share of their population covered under the scheme, Andhra Pradesh and Punjab have more than all-india average of per cent of population covered. Amongst States with highest Levels of Poverty, Chhattisgarh has highest level of poverty but also lie in class of highest level of coverage under PMJDY. MP too had highest level of poverty but satisfactory levels of performance on fronts of PMJDY with more than average level of accounts opened under it. Odisha with average per cent of population covered, and Bihar and Jharkhand with less than average coverage under PMJDY are poor performers on the front, as they are falling in category of states with highest levels of poverty. Uttar Pradesh lying in next category of states with more than average poverty levels, also seem to be lagging behind with just about average performer in PMJDY accounts. December, January, socio - economic voices

13 Source Damgaard, C. and Weiner, J. "Describing Inequality in Plant Size or Fecundity." Ecology 81, , Dixon, P. M.; Weiner, J.; Mitchell-Olds, T.; and Woodley, R. "Bootstrapping the Gini Coefficient of Inequality." Ecology 68, , Dixon, P. M.; Weiner, J.; Mitchell-Olds, T.; and Woodley, R. "Erratum to 'Bootstrapping the Gini Coefficient of Inequality.' " Ecology 69, 1307, Gini, C. "Variabilitá e mutabilita." Reprinted in Memorie di metodologia statistica (Ed. E. Pizetti and T. Salvemini.) Rome: Libreria Eredi Virgilio Veschi, Kendall, M. G. (1970), Rank Correlation Methods, London: Griffin, ISBN Census of India, 2011, Govt of India Websites 1. vol2/data_files/himachal%20pradesh/statement%20%20wise1.5.pdf December, January, socio - economic voices