Cabinet Doubles Jan Dhan Yojana Overdraft Limit; Makes it an Open Ended Scheme

In an attempt to encourage more people to open bank accounts, the government on Wednesday decided to make the Pradhan Mantri Jan Dhan Yojana (PMJDY) an open-ended scheme and has added more incentives to the scheme. Following a crucial cabinet meeting, Finance Minister Arun Jaitley said while briefing the reporters that due to the "runway success" of the scheme, the cabinet has decided to make it an open-ended scheme, meaning that it will continue indefinitely.

The Jan Dhan Yojana scheme was launched in August 2014 for a period of four years as a national mission for financial inclusion to ensure access of financial services like bank accounts, insurance, and pensions to the masses. The government has now decided to make the scheme more attractive to those who wish to open new accounts by including the following changes:

1. Overdraft facility on these accounts doubled from Rs 5,000 to Rs 10,000, of which Rs 2,000 will be given without preconditions.
2. Accidental insurance cover that is available on RuPay debit cards linked to new insurance accounts will be doubled to Rs 2 lakh
3. Age limit for availing the overdraft facility is extended to 65 years from 60.

He also said that 32.41 crore accounts have been opened under the scheme so far and as much Rs 81,200 crore has been deposited in them. Jaitley said 53 percent of the PMJDY account holders are women, while 83 percent of the accounts are seeded with Aadhaar. The government now aims at providing bank accounts to every Indian household.