Banks to shut inactive Jan Dhan accounts? Government clarifies; check details

NEW DELHI: The Department of Financial Services (DFS) under the Ministry of Finance has refuted media reports claiming it instructed banks to shut dormant Pradhan Mantri Jan-Dhan Yojana (PMJDY) accounts.

In an official statement issued on July 8, the ministry clarified that no such directive has been given and that the reports are "factually incorrect."

"In connection with reports appearing in media that the Department of Financial Services (DFS), M/o Finance, has asked banks to close inactive PM Jan Dhan Yojana accounts, the Department of Financial Services has said that it has NOT asked banks to close inactive PM Jan Dhan Yojana accounts," the ministry of finance said in a release on Tuesday.

"The total number of PMJDY accounts has seen a continuous increasing trend, and no incidents of mass closure of inactive PMJDY accounts have come to the knowledge of the department," it added.

Instead, the government has launched a nationwide three-month campaign starting July 1 to promote financial inclusion through greater adoption of Jan Dhan accounts, as well as associated schemes like the Jeevan Jyoti Bima Yojana, Atal Pension Yojana, and others.

As part of the campaign, banks have been asked to conduct re-KYC for due accounts and reach out to account holders with inoperative accounts to make them active again.

DFS will continue monitoring the status of inactive PMJDY accounts, but has confirmed that there have been no instances of mass closure, ET reported.

What is PMJDY?

The Pradhan Mantri Jan Dhan Yojana is a flagship financial inclusion initiative aimed at providing affordable banking services to every Indian, especially the unbanked population. Benefits include:

• No minimum balance requirement
• Interest on deposits
• Free RuPay debit card
• Accidental insurance cover up to Rs 2 lakh
• Overdraft facility up to Rs 10,000 for eligible account holders
• Eligibility for schemes like DBT, PMJJBY, PMSBY, APY, and MUDRA

PM Jan Dhan Yojana: Overdraft, insurance & account opening explained
An overdraft (OD) of up to Rs 10,000 is available for one eligible account holder per household. To avail this, the account must be at least six months old and should have been operated satisfactorily. Other eligibility criteria as set by banks must also be met.

Can both husband and wife avail the overdraft and insurance?

• Accidental Insurance: All individual PMJDY account holders with a valid RuPay card are eligible for accidental insurance, Rs 1 lakh for older accounts and Rs 2 lakh for accounts opened after August 28, 2018.
• Overdraft: Only one member per family is eligible for the Rs 10,000 OD facility, even if both spouses have PMJDY accounts.

Documents needed to open a PMJDY Account: If Aadhaar is available, no other document is needed. However, if the address has changed, a self-declaration is sufficient. If Aadhaar is not available, any one officially valid document, such as:

• Voter ID
• Driving License
• Passport
• NREGA Card (If these documents include the address, they serve as both ID and address proof.)

For individuals without valid documents: Accounts can still be opened if the person is deemed "low risk" by the bank, using: a photo ID card issued by a government department, regulator, PSU, or a scheduled commercial bank, or a letter from a gazetted officer with a certified photograph of the applicant.
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