Jan Dhan accounts 60% rise during pandemic

The Covid-19 has led to a 60% increase in opening of new Jan Dhan accounts and they are acting as a deterrent to crime in several states, an SBI research report has said.

Latest data showed that the total number of Pradhan Mantri Jan Dhan Yojana accounts stood at over 41 crore with a total balance of Rs 1.31 lakh crore. Since April 1, around 3 crore accounts were opened, with deposits of Rs 11,060 crore. The average balance of PMJDY accounts increased to Rs 3,400 in April and declined thereafter to Rs 3,168 in September and marginally increased to Rs 3,185 in October, the report said.

“Thus, the initial increase in average balance that was primarily due to the loss of livelihood due to the pandemic and shift of migrant labourers from urban areas to home, resulting in jump of precautionary savings, may have been reversed,” said Soumya Kanti Ghosh, group chief economic adviser at SBI.

Using the JAM (Jan Dhan-Aadhaar-Mobile) trinity as it is popularly known, the Centre managed to seamlessly transfer money to these accounts, particularly women account holders, to help the poor tide over the difficult pandemic period. Transfer of money at such a large scale has earned praise from multilateral agencies and experts.

Citing empirical research, the report said PMJDY accounts work as a primary vehicle for labour remittances, apart from increased lending, smoothing consumption, increased spending on healthcare and, most importantly, the usage is more frequent in areas that are more crime prone.

The PMJDY data was juxtaposed with statewise crime data to assess the impact of these accounts on crime in those areas.