Total amount deposited in Jan Dhan bank accounts exceeds budgetary allocation for education or health sector, or money earmarked for MNREGA in Budget 2019-20. (Photo: PTI)

Latest data on Pradhan Mantri Jan Dhan Yojana (PMJDY) put the total deposits in the zero-balance bank accounts at over Rs 1 lakh crore or Rs 1 trillion. This is roughly the amount allocated to home affairs in the Union Budget presented by Finance Minister Nirmala Sitharaman on July 5.

According to data on the PM Jan Dhan Yojana website, the total number of Jan Dhan accounts was 36.06 lakh as on July 3. These accounts held Rs 1,00,495 crore in deposits.

In Budget 2019-20, the allocation for "Home Affairs" is pegged at Rs 1,03,927 crore. For the sake of curiosity, amount deposited in the Jan Dhan accounts may be compared with budgetary allocation to education - Rs 94,854 crore, health - Rs 64,999 crore, and Mahatma Gandhi National Rural Employment Guarantee Programme (MNREGA) - Rs 60,000 crore to get a perspective of the scale of deposits in these accounts.

Nearly 60 per cent of these accounts were opened in rural and semi-urban areas giving a strong banking connect of the government with the smaller pockets of the country. More than 53 per cent of the beneficiaries are women and a large number of them are from rural areas.

This assumes significance in the view that the Narendra Modi government has launched a range of welfare schemes that are facilitated through Jan Dhan bank accounts. A major source of rise in deposits in Jan Dhan accounts is the cash transfer made by the government under the Direct Benefit Transfer (DBT) scheme.

The percentage of actual zero-balance Jan Dhan accounts has been reducing since 2015, when its share was above 58 per cent. According to the government's reply in Parliament earlier this year, only 15 per cent of Jan Dhan accounts were zero balance as on January 23, 2019.

The average balance in the Jan Dhan bank accounts had increased from Rs 1,065 as on March 25, 2015 to nearly double at Rs 2,603 as on January 23 this year.

A World Bank report titled, the Global Findex Report 2017 - when the Jan Dhan bank account holders were around 31 crore in number - stated that due to PMJDY, bank account penetration in rural areas increased from 52 per cent in 2014 to 79 per cent in 2017.

The poor were identified as the biggest beneficiaries of the Jan Dhan scheme. The report said the bank account penetration among adults in the poorest 40 per cent of households had risen by 30 percentage points from 44 per cent in 2014 to 77 per cent in 2017.

Jan Dhan scheme played an important role in sustaining wave in favour of Prime Minister Narendra Modi in 2019 Lok Sabha election. (Photo: PTI file)

The Narendra Modi government had launched the Jan Dhan scheme in August 2014, three months after coming to power. It was launched to provide universal access to banking facilities to all Indian households.

The Jan Dhan bank account scheme was one the factors that helped sustain the political wave in favour of Prime Minister Narendra Modi and his Bharatiya Janata Party in the 2019 Lok Sabha election. It not only increased bank's penetration in the country but also strengthened Modi's political connection with the voters.

The Jan Dhan bank accounts bring some associated benefits such as overdraft facility if the account holder operates it satisfactorily for six months. Initially, the overdraft against each Jan Dhan account was allowed to Rs 5,000. It was increased to Rs 10,000 last year.

A Jan Dhan account holder is entitled to get a Rupay debit card and an insurance cover of Rs 2 lakh. The accident insurance coverage was capped at Rs 1 lakh till August 2018.

Before the Lok Sabha election was announced, more than 6,000 accidental insurance claims were made and more than 4,000 had been settled as on February 19. Currently, there are 28.45 crore Rupay debit card holders among the Jan Dhan beneficiaries.

Launched as a universal banking access scheme, Jan Dhan has proved to be a very potent tool of politicl campaign for the Narendra Modi government.