The Curious Case of 4.5 Million Jan Dhan Accounts That Were Closed During India’s Demonetisation Chaos
Monday, January 16, 2017
The Narendra Modi government’s flagship financial inclusion scheme—the Pradhan Mantri Jan-Dhan Yojana (PMJDY)—has always been about big numbers.
On Aug. 28, 2014, the first day of the scheme’s roll out, some 15 million bank accounts were reportedly opened. A year later, the number of accounts swelled to 175 million, government data shows. By Jan. 04, 2017, there were over 265 million accounts under the scheme, although 24% of them had no money in them.
When the Modi government announced its shock move to demonetise 86% of India’s currency (by value) on Nov. 08, this large base of PMJDY accounts came handy in the push to make the economy less dependent on cash. Since demonetisation, cash deposits in PMJDY accounts have more than doubled to Rs87,000 crore.
Yet, during this period of intense pressure on banks, there’s been a rather curious development: Over four million PMJDY accounts, across a handful of public and private banks, have been closed—and there’s nothing to explain this.