In his first term, Prime Minister Narendra Modi initiated several pro-poor schemes.
One such scheme is the Pradhan Mantri Jan Dhan Yojana (PMJDY), which offers numerous benefits to account holders. One notable perk is an overdraft facility of up to Rs 10,000, even with zero account balance.
Conditions for Overdraft
To be eligible for an overdraft, the account must be at least 6 months old. Account holders are entitled to an unconditional overdraft of up to Rs 2000, with a maximum age limit of 65 years.
The government recently increased the overdraft limit from Rs 5,000 to Rs 10,000. The primary aim of these accounts is to encourage savings among low-income individuals. Account holders also receive ATM cards and access to insurance and pension benefits.
Jan Dhan’s Reach
Over 50 crore Jan Dhan accounts have been opened so far, with a significant percentage belonging to women (55.5%) and most located in rural and semi-urban areas (67%).
The total deposited amount in these accounts has exceeded Rs 2 lakh crore. Additionally, approximately 34 crore ‘Rupay Cards’ have been issued for these accounts, providing a complimentary accident insurance cover of Rs 2 lakh.
Key Principles of the Scheme
The core principle behind PMJDY is to extend banking services to those who lack access.
This involves opening Basic Savings Bank Deposit (BSBD) accounts with minimal paperwork, simplified Know Your Customer (KYC) procedures, account opening in camp mode, maintaining zero balance, and charging zero fees.
Furthermore, the scheme includes providing indigenous debit cards for cash withdrawals and payments at merchant locations, along with free accident insurance coverage of Rs 2 lakh.
