FINANCIAL INCLUSION: PRESENT SCENARIO OF PRADHAN MANTRI JAN DHAN YOJANA SCHEME IN INDIA

FINANCIAL INCLUSION: PRESENT SCENARIO OF PRADHAN MANTRI JAN DHAN YOJANA SCHEME IN INDIA *Dr. P. Chellasamy Associate Professor, School of commerce, Bharathiar University, Coimbatore. **Mr. R. Selvakumar ICSSR Doctoral Fellow, School of commerce, Bharathiar University, Coimbatore. ABSTRACT The Government of India desire to use the banking system as an important agent of change was at the core of most policies that were formulated after Independence. The planning strategy recognized the critical role of the availability of credit and financial services to the public at large in the holistic development of the country with the benefits of economic growth being distributed in a democratic manner. In respect of this role, the authorities modified the policy framework from time to time to ensure that the financial services needs of various segments of the society were met a satisfactory level. According to World report, Jan Dhan Yojana has failed to address the biggest challenge as the mere opening of bank accounts may not fulfill the aim of the scheme, but there should be a continuous operation of bank accounts to give the real success of the scheme. The objective of the study is to analyze the performance of participant banks in Pradhan Mantri Jan Dhan Yojana scheme in India. The paper reveals that PMJDY scheme is fully helpful to rural and urban area people in getting directly the government schemes. The study concludes that, PMJDY scheme has created an impressive result in the banking sector with regard to eradication of financial untouchability in the country. Mere opening of bank accounts may not fulfill the aim of the scheme, but there should be a continuous operation of bank accounts to give the real success of the scheme. Keywords: deposit, pmjdy, ing Services, RuPay Debit Card, Financial Inclusion INTRODUCTION The National Mission on Financial Inclusion or Pradhan Mantri Jan Dhan Yojana was started by the Ministry of Finance, Department of Financial Services, Government of India, with a wide vision to provide access to banking facilities to those people who are not having any bank accounts or still unbanked from the formal banking sector, so that they can also be involved in the banking sector which is necessary for economic development and for the welfare of poor people. Under this scheme people will get basic bank accounts with insurance facility and an additional facility of overdraft. Thus, they will avail benefit offered by banks and facilities provided by the government and will be able to develop small savings habits among them, and it will enhance capital formation, which will in result increase economic development of the country. Since from its inauguration on august 28, 2014 the Pradhan Mantri Jan Dhan Yojana scheme of financial inclusion has become very effective. The public sector banks are playing their role in making the scheme a success with approx. 9.22 crore accounts in rural areas and 7.30 crore accounts in urban areas and involving more and more people with formal banking system. As the purpose of financial inclusion is to provide low cost banking services and facilities to poor section and to those who are financially excluded that is why most of the accounts are opened with zero balance bank account out of 21.00 cores accounts opened so far 28.88 percent accounts have been opened with zero balance accounts. The debit card facility is also looking very helpful to poor people where they can withdraw money at any time and at any place according to the table 17.46 Crores debit cards have been issued so far by all banks, including public, private, and rural regional banks which shows that banks are achieving their targets of financial inclusion. The data provided by the Department of Financial Services as on February 1, 2017 a total of 27 crore (270 million) bank accounts have been opened of which Rs 665 billion were deposited under the scheme. 37

SURVEY OF EARLIER STUDIES Hema and Divya (2014) A study on Financial Inclusion Using Pradhan Mantri Jan-Dhan Yojana A Conceptual Study The Financial inclusion means providing financial products and services to people at very low cost or providing financial services to that section of society, which do not have basic banking facilities, such as saving accounts or deposit and payment facility.1 For effective growth of economy, it is necessary to involve those people in banking sector who are not having access to banking sector, so that they can avail benefits of banking services and facilities, and develop habits of small savings. This paper is descriptive in nature and simple trend analysis is used to describe the progress of (PMJDY), the paper also described the various challenges faced by financial inclusion in India as well various steps taken by authorities to promote financial inclusion in India. The study suggests that private and public sector banks along with Government and RBI has to play much active role in the creation of awareness among deprived sections of society, and to design more innovative products for the poorest section to promote financial inclusion in India. Mohammad Sadhik, Avvamath Safeena, Jameela (2015) A study on A Study on Financial Inclusion with Special Reference to Pradhan Mantri Jan-Dhan Yojana (Pmjdy) To promote the economic growth, Prime Minister Narendra Modi announced a new scheme in his Independence Day speech on 15th Aug 2014, and called it as the National Mission for Financial Inclusion (NMFI) for weaker section and low income groups. While launching the Pradhan Mantri Jan Dhan Yojana on 28th Aug 2014, the scheme managed to open record 1.5 carries new bank accounts on the inaugural day itself. This effort will certainly go a long way in promoting economic growth and reducing poverty, while mitigating systematic risk and maintaining financial stability. For analyzing such facts secondary sources of data have been collected. It is not very much correct time to evaluate the PMJDY scheme which is only in its infant stage. But an attempt has been made in this paper to analyze the performance so far, benefits, difficulties and future prospects of the scheme. Pramahender, Narender Singh (2016) A study on Financial Inclusion: Role of Pradhan Mantri Jan Dhan Yojana The Financial inclusion or inclusive financing is the delivery of financial services at affordable costs to sections of disadvantaged and low-income segments of society, in contrast to financial exclusion where those services are not available or affordable. The scheme is not only limited to opening of a bank account, but has other benefits with it viz. A Zero balance bank account with RuPay debit card, in addition to the accidental insurance cover of Rs 1 lakh, those who open accounts by January 26, 2015 over and above the Rs 1 lakh accident, they will be given life insurance cover of Rs 30,000, etc. This paper is an attempt to discuss the overview of financial inclusion using PMJDY in India STATEMENT OF THE PROBLEM Most of the population of India is living in rural areas, hence they have less access to the formal banking sector. The role of financial inclusion becomes active by providing banking facilities to the rural population and involving them in circle of finance. Pradhan Mantri Jan Dhan Yojana (PMJDY) is a National Mission for Financial Inclusion based on Sab ka sath sab ka Vikas i.e. inclusive growth to ensure access to financial services, namely, ing/ Savings & Deposit Accounts, Remittance, Credit, Insurance, Pension in an affordable manner, launched by Shri. Narendra Modi on 28 August 2014. On the inauguration day, 1.5 Crore bank accounts were opened under this scheme. Guinness World Records Certificate says "The most bank accounts opened in 1 week as a part of a financial inclusion campaign is 18,096,130 and was achieved by s in India from 23 to 29 August 2014". By 05 July 2017, 17.45 crore accounts were opened; with around Rs 64,431.34 crore were deposited under the scheme. Even though there was an increase in the bank accounts, this scheme was not fully recognized by the rural people of India. According to World report, Jan Dhan Yojana has failed to address the biggest challenge as the mere opening of bank accounts may not fulfill the aim of the scheme, but there should be a continuous operation of bank accounts to give the real success of the scheme. Hence the researcher has framed following research questions What is the performance of Participant banks of the Pradhan Mantri Jan-Dhan Yojana scheme in India? What is the state wise performance of Pradhan Mantri Jan-Dhan Yojana scheme in India? RESEARCH OBJECTIVES To analyze the present scenario of Prdhan Manti Jan Dhan Yojana scheme in India. METHODOLOGY Sources of data The study will be based on secondary data. The data for the research will be collected from government publications, published articles, newspapers, reports, and official websites. 38

Period of the study The study covers a period of 4 years from 2014 2015 to 2016 2017. SIGNIFICANCE OF THE STUDY The study would contribute to the analysis of different aspect of the performance of Pradhan Mantri Jan Dhan Yojana scheme in India. The study helps the decision makers to identify the progress and challenges of the scheme. SCOPE OF THE STUDY The study considers only the account holders under the Pradhan Mantri Jan Dhan Yojana scheme in India. To analyze the performance of banks, only those banks which are the participants of this scheme will be taken. Table 1 No.of accounts opened under Pradhan Mantri Jan dhan Yojana scheme in India for the period from 2016-2017 (Rs in crores) category at rural/ semi-urban centre bank at urban /metro centre bank No.of Rupay cards issued to Balance in beneficiary accounts branches branches Public sector 23.38 12.78 10.60 18.03 50,820.29 Private sector 0.94 0.57 0.37 0.87 2,056.56 Regional Rural 4.72 4.02 0.71 3.56 11,554.50 29.04 17.36 11.68 22.45 64431.36 Source: www.pmjdy.in Table 1 shows that No.of accounts opened in the Pradhan Mantri Jan Dhan Yojana scheme in India for the period of 2014-2015 to 2016-2017. The total no.of savings bank accounts opened in Public Sector s was 23.38 crores accounts. The of rural or semi urban centre banks was 12.78 crore accounts. The of urban or metro centre bank was 10.60 crore accounts. The no.of issued to Rupay cards was 18.03 crore cards. The Balance in beneficiary accounts amount of Rs 50,820.29 crore for the period of 2014-2015 to 2016-2017. The opened Private Sector s total no.of accounts of 0.94 crores accounts. The of rural or semi urban centre banks was 0.57 crore accounts. The of urban or metro centre bank was 0.37 crore accounts for the period of 2014-2015 to 2016-2017. The total no.of savings bank accounts opened in Regional Rural s was 4.72 crores accounts. The of rural or semi urban centre banks was 4.02 crore accounts. The of urban or metro centre bank was 0.71 crore accounts. The no.of issued to Rupay cards was 3.56 crore cards. The Balance in beneficiary accounts amount of Rs 50,820.29 crore for the period of 2014-2015 to 2016-2017. The No.of Rupay cards issued for Public sector banks was 18.03 crpre cards for the period of 2014-2015 to 2016-2017. Table 2 State wise account opening in Pradhan Mantri Jan Dhan Yojana for the period 2014-2015 to 2016-2017 State Name at rural/semiurban centre bank branches at urban/metro centre bank branches Balance in beneficiary accounts (in crore) No. of RuPay cards issued to % ANDAMAN & 0.08 NICOBAR 35,520 16,185 51,705 23.17 42,269 ANDHRA 3.03 PRADESH 45,44,573 42,59,805 88,04,378 1,334.13 73,64,324 ARUNACHAL 0.08 PRADESH 1,30,564 88,187 2,18,751 64.58 1,74,112 ASSAM 90,88,370 29,96,766 1,20,85,136 2,456.02 93,04,346 4.16 BIHAR 1,95,56,356 1,06,89,931 3,02,46,287 5,375.67 2,11,34,163 10.41 CHANDIGARH 36,589 1,85,589 2,22,178 83.26 1,85,413 0.08 CHHATTISGARH 83,46,770 41,62,496 1,25,09,266 1,814.14 84,64,223 4.31 DADRA & 0.03 NAGAR HAVELI 70,209 11,339 81,548 25.01 48,742 DAMAN & DIU 18,862 13,371 32,233 10.35 20,734 0.01 DELHI 5,05,308 32,61,420 37,66,728 1,383.61 30,32,966 1.30 GOA 1,06,475 39,870 1,46,345 73.03 1,21,427 0.05 GUJARAT 58,53,373 52,90,010 1,11,43,383 2,635.61 88,76,543 3.84 39

HARYANA 33,10,173 28,03,196 61,13,369 2,231.26 51,48,335 2.10 HIMACHAL 0.31 PRADESH 8,01,223 1,13,759 9,14,982 389.54 7,58,921 JAMMU & 0.67 KASHMIR 16,66,683 2,72,731 19,39,414 689.56 14,75,692 JHARKHAND 75,93,534 26,28,368 1,02,21,902 1,843.48 75,74,340 3.52 KARNATAKA 62,69,686 44,36,014 1,07,05,700 2,338.93 93,27,948 3.69 KERALA 15,28,287 17,13,396 32,41,683 1,015.91 24,26,156 1.12 LAKSHADWEEP 4,406 380 4,786 5.94 4,033 1.86 MADHYA 8.83 PRADESH 1,23,38,680 1,33,23,449 2,56,62,129 3,091.54 1,85,52,727 MAHARASHTRA 99,99,965 1,01,39,573 2,01,39,538 3,734.92 1,44,26,719 6.93 MANIPUR 3,36,037 4,12,436 7,48,473 166.06 6,61,357 0.26 MEGHALAYA 3,31,311 67,100 3,98,411 208.06 2,17,760 0.14 MIZORAM 1,10,689 1,79,525 2,90,214 56.92 98,755 0.10 NAGALAND 1,11,859 1,09,970 2,21,829 37.08 1,76,599 0.08 ORISSA 84,98,284 31,09,208 1,16,07,492 2,878.78 90,72,823 3.20 PUDUCHERRY 66,906 74,312 1,41,218 32.22 1,21,230 0.04 PUNJAB 31,20,186 23,78,945 54,99,131 2,059.16 46,27,973 1.89 RAJASTHAN 1,22,51,419 73,61,515 1,96,12,934 4,985.32 1,66,54,438 6.75 SIKKIM 70,935 20,747 91,682 29.37 68,770 0.03 TAMIL NADU 41,46,827 46,85,635 88,32,462 1,310.14 73,63,849 3.04 TELANGANA 47,80,901 40,97,528 88,78,429 1,252.79 74,84,424 3.06 TRIPURA 5,73,993 2,28,774 8,02,767 611.65 7,04,468 0.28 UTTAR 2,67,89,770 1,82,88,568 4,50,78,338 10,385.76 3,56,09,219 15.52 PRADESH UTTARAKHAND 13,43,537 7,36,483 20,80,020 721.87 16,54,377 0.71 WEST BENGAL 1,92,62,529 86,34,666 2,78,97,195 9,076.5 2,15,48,788 9.60 Grand 17,36,00,789 11,68,31,247 29,04,32,036 64,431.34 22,45,28,963 Source: www.pmjdy.in Table no:2 reveals that the Pradhan Mantri Jan Dan Yojana if State wise performance of the scheme the performance of 2014-2015 to 2016-2017. The highest value of total beneficiary of account holdings in Uttar Pradesh state of 4,50,78,338 accounts for the period of 2014-2015 to 2016-2017. The lowest value of beneficiary of accounting holdings in Lakshadweep state of 4,786 accounts for the period of 2014-2015 to 2016-2017. The highest value of total Balance in beneficiary accounts Uttar Pradesh state of Rs 10,385.76 crore for the period of 2014-2015 to 2016-2017. The lowest value of Balance in beneficiary accounts Lakshadweep state of Rs 5.94 crore for the period of 2014-2015 to 2016-2017. The highest value of the RuPay card issue in the Uttar Pradesh state the value is 3,56,09,219 cards for the period of 2014-2015 to 2016-2017. The lowest value of the RuPay card issue in the Lakshadweep state of 4,033 cards for the period of 2014-2015 to 2016-2017. The highest level of Table 3 No. of Accounts opened Public Sector s under Pradhan Mantri Jan dhan Yojana scheme in India from the period 2014-2015 to 2016-2017 Name of at rural/semi urban centre bank branches at urban/ metro centre bank branches No. of Accounts No. of Rupay Debit Card Balance in Accounts (In Lakhs) No. of Accounts % 2.85 Allahabad 54,47,961 12,19,760 66,67,721 51,80,192 1,31,410.87 Andhra 16,21,528 7,95,129 24,16,657 19,36,384 31,026.80 1.03 of 8.90 80,26,780 1,27,91,908 2,08,18,688 1,94,32,821 4,81,085.77 Baroda of India 83,15,877 92,68,794 1,75,84,671 1,66,02,735 3,46,530.20 7.52 of 1.94 34,39,096 11,00,523 45,39,619 9,06,630 93,403.12 Maharashtra Canara 44,96,157 20,78,826 65,74,983 42,75,045 1,74,059.97 2.81 Central 4.45 76,96,607 19,99,437 96,96,044 72,39,246 1,65,078.30 of India 40

Corporation 1.15 13,61,847 13,38,128 26,99,975 25,47,345 1,02,217.98 Dena 32,04,400 9,06,796 41,11,196 25,69,346 74,307.18 1.76 IDBI 0.35 4,63,160 3,61,521 8,24,681 6,67,107 18,629.64 Ltd. Indian 21,78,278 10,86,635 32,64,913 32,29,211 43,867.81 1.40 Indian 1.84 Overseas 9,61,154 33,53,860 43,15,014 40,72,155 71,462.75 Oriental of Commerce 22,83,057 17,61,211 40,44,268 37,11,998 4,11,118.57 1.73 Punjab & 0.32 4,93,326 2,59,627 7,52,953 7,20,632 53,917.36 Sind Punjab 7.16 National 1,41,10,101 26,45,800 1,67,55,901 1,34,69,118 2,95,759.75 State of 42.35 4,45,08,046 5,45,11,818 9,90,19,864 6,94,54,079 13,70,071.30 India Syndicate 1.87 3,00,2867 13,76,043 43,78,910 38,00,502 1,13,599.91 UCO 31,56,476 26,87,537 58,44,013 39,52,503 1,29,516.64 2.50 Union 2.98 54,90,669 14,75,902 69,66,571 48,89,907 1,27,377.16 of India United 4.73 66,90,334 43,81,441 1,10,71,775 1,01,34,049 8,28,938.97 of India Vijaya 8,21,902 6,40,039 14,61,941 14,61,641 18,649.25 0.62 12,77,69,623 10,60,40,735 23,38,10,358 18,02,52,646 50,82,029.31 Source: www.pmjdy.in Table no:3 reveals that the Pradhan Mantri Jan Dan Yojana if public sector bank wise performance of period from 2014-2015 to 2016-2017. It is found that, the highest rural accounts opened in total beneficiary of account holdings in State of India was 4,45,08,046 accounts The lowest rural accounts accounts opened in Punjab & Sind was 4,93,326 accounts for the period of 2014-2015 to 2016-2017. It is found that, the highest urban accounts opened in total beneficiary of account holdings in State of India was 5,45,11,818 accounts. The lowest urban accounts opened in Punjab & Sind was 2,59,627 accounts from the period of 2014-2015 to 2016-2017. The highest no. of rupay card issued in State of India was 6,94,54,079 cards. The lowest no.of rupay card issued in Punjab & Sind was 7,20,632 cards from the period of 2014-2015 to 2016-2017. It is found that, the highest amount of Balance in accounts State of India was Rs 13,70,071.30 in lakhs. The lowest amount of Balance in accounts Andhra was Rs 31,026.80 lakhs. To received the total amount of Pradhan Mantri Jan Dhan Yojana of Rs 50,82,029.31 rupees from the period of 2014-2015 to 2016-2017. 41

Table 4 No of Accounts opened Private Sector s under Pradhan Mantri Jan dhan Yojana from the period of 2014-2015 to 2016-2017 Rupay Debit Balance in at rural/semi at urban/ Name of Cards issued beneficiary urban centre metro centre to accounts bank bank % (In lakhs) branches branches Axis 7.71 1,07,989 6,14,998 7,22,987 6,42,906 18,130.52 Ltd City Union 0.89 15,759 68,199 83,958 71,147 1,462.56 Ltd Federal 4.98 3,85,820 80,746 4,66,566 4,12,641 17,987.57 Ltd HDFC 18.88 3,31,297 14,38,932 17,70,229 17,69,551 83,915.85 Ltd ICICI 38.09 31,87,860 3,83,269 35,71,129 35,71,129 20,773.30 BANK IndusInd 4.72 41,896 4,00,823 4,42,719 4,18,100 2,993.30 J&K 13,29,067 1,34,857 14,63,924 11,59,601 52,147.77 15.61 Karur 1.92 24,219 1,56,313 1,80,532 1,35,670 1563.39 Vysya kotak 1.92 Mahindra 1,08,132 72,371 1,80,503 1,32,974 1,822.24 Lakshmi 1.89 49,234 1,27,955 1,77,189 1,75,679 1,553.92 vilas RBL 59,787 35,520 95,307 95,307 271.46 1.02 South 2.19 30,320 1,74,934 2,05,254 62,751 4,387.73 Indian Yes 7,880 7,701 15,581 14,407 209.16 0.17 56,79,260 36,96,618 93,75,878 86,61,863 2,05,656.44 Source: www.pmjdy.com Table no:4 shows that the Pradhan Mantri Jan Dan Yojana if Private sector wise performance of period from 2014-2015 to 2016-2017. It is found that, the highest accounts opened at rural and semi urban centre bank branches of ICICI was 31,87,860 accounts. The lowest accounts opened at rural and semi urban centre bank branches of Yes was 7,880 accounts from the period of 2014-2015 to 2016-2017. The highest accounts opened at urban and metro centre bank branches of HDFC was 14,38,932 accounts. The lowest accounts at urban and metro centre bank branches of Yes was 7,701 accounts from the period of 2014-2015 to 2016-2017. The highest no. of rupay card issued for ICICI was 35,71,129 cards. The lowest no.of Rupay card issued for Yes was 14,407 cards from the period of 2014-2015 to 2016-2017. The highest amount of Balance in accounts for HDFC was 83,915.85 rupees. The lowest amount of Balance in accounts for Yes was 209.16 rupees. To received the total amount of Pradhan Mantri Jan Dhan Yojana of 2,05,656.44 rupees from the period of 2014-2015 to 2016-2017. SUGESSIONS ATM Network in rural India is less hence the people are less aware of using ATM s. Government can easily encourage people to open new accounts but the biggest challenge is increasing the transactions in those accounts No check on the new account chances of existing account holders opening additional accounts under this scheme is high COCLUSION The Pradhan Mantri Jan Dhan Yojana is superior financial inclusion programme because it had focus on individual households. Further, there was no emphasis given on financial inclusion in rural, semi - urban and urban areas. Overall, the scheme is a big step towards financial inclusion. It concludes that, the performance of the Public sector banks are good as compared to the Regional rural banks and Private sector banks to carry Pradhan Mantri Jan Dhan Yojana scheme. It found that, total 29.04 crore accounts were opened with total deposits of 64,431.34 crore out of which, 15 per cent accounts were opened with zero balance. This scheme ensured access to financial services, namely, ing/ Savings & Deposit Accounts, Remittance, Credit, Insurance, Pension in an affordable manner to poor people in rural, semi-urban and urban areas. 42

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