PMJDY’s Decade of Transformation: India Leads Global Financial Inclusion

The Pradhan Mantri Jan Dhan Yojana (PMJDY) has revolutionized financial inclusion in India, covering 80% of women and bridging the rural-urban and gender gaps. Its digital infrastructure has propelled bank ownership from 26% in 2011 to 78% in 2021. Globally praised, the initiative has outpaced China's financial inclusion metrics.

The Pradhan Mantri Jan Dhan Yojana (PMJDY), which marked its tenth anniversary on Wednesday, has significantly transformed financial inclusion across India. Launched in 2014, the scheme has brought more than 80% of Indian women into the financial fold, with bank account ownership increasing from 26% in 2011 to 78% in 2021.

Of the total 53.13 crore Jan Dhan accounts, over 30 crore belong to women, and more than 35 crore are in rural or semi-urban areas. The PMJDY has effectively narrowed the rural-urban divide, with 95% of urban households and 96% of rural households now having a bank or post office account. Additionally, the gender gap in accessing financial services has shrunk from 20% in 2011 to 6% in 2017, below the global average of 9%.

The scheme offers various benefits, including the issuance of over 36.13 crore RuPay debit cards as of August 2024. These cards provide Rs 2 lakh insurance and an overdraft facility up to Rs 10,000. The integration of Aadhar cards, mobile penetration, and Jan Dhan accounts—termed the JAM trinity—has accelerated financial inclusion from 25% in 2008 to over 80% in the past six years.

PMJDY has also laid the groundwork for numerous economic initiatives, such as direct benefit transfers, COVID-19 financial aid, and PM-KISAN. An SBI report in 2021 noted that states with higher PMJDY balances experienced reduced crime rates and lower alcohol and tobacco consumption, underscoring the scheme's positive social impact.

Internationally acclaimed, the Jan Dhan Yojana has been recognized for its transformative impact. A 2023 G20 report by the World Bank highlighted that India achieved its financial inclusion goals in just six years, a task that would have taken 47 years otherwise. India has surpassed China in financial metrics, with mobile and internet banking transactions rising dramatically and bank branches per 100,000 adults exceeding those in Germany, China, and South Africa. From 2011 to 2021, India's account ownership soared from 35% to 78%, largely due to government initiatives.

(With inputs from agencies.)