Within two weeks of Prime Minister Narendra Modi announcing the demonetisation, deposits in the Jan Dhan accounts in Gujarat, PM’s home state, has more than doubled. After demonetisation, the deposits into Jan Dhan accounts in Gujarat has gone up from Rs 1,686.33 crore (on November 9) to Rs 3,559.45 crore (on November 23). This means Rs 1,873.12 crore was deposited in just 15 days. The deposits in rural areas were so huge that several accounts, according to the figures available now, have been converted into regular savings accounts as per the guidelines of the Pradhan Mantri Jan Dan Yojana (PMJDY), which states that a deposit of more than Rs 50,000 in one month merits to be converted into a regular savings account, a state government official said on condition of anonymity.
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Therefore, the zero-balance Jan Dhan accounts in Gujarat have reduced by 30,909 until November 23 (from 19,26,793 on November 9 to 18,95,884 on November 23).
According to data from the Department of Financial Services, Ministry of Finance, Gujarat witnessed a decline in the number of rural Jan Dhan accounts due to the increased deposits following demonetisation. Between November 9 – a day after the Centre effected demonetisation – and November 23, the number of rural accounts under the PMJDY scheme in Gujarat dipped by 4,371 from 48,31,549 accounts on November 9 to 48,27,178 accounts on November 23. The corresponding figures of urban accounts under the scheme, however, saw an increase by 28,830 from 41,62,932 on November 9 to 41,91,762 on November 23.
According to officials from the Gujarat State Jan Dhan Mission, the decline in the rural bank accounts is a result of the increased deposits, which automatically turn the Jan Dhan accounts into regular savings account, as per rules.
For instance, in Banaskantha district in north Gujarat, as many as 250 Jan Dhan accounts were converted into savings accounts “following high cash deposits in a single district,” before the RBI explicitly capped the post-demonetisation Jan Dhan deposit to Rs 50,000, said a source.
An official of the state government, requesting anonymity, said, “The reason why the number of Jan Dhan accounts has lowered in the rural areas is because some of these accounts may have exceeded the stipulated deposit limit of the account. One of the features of the PMJDY accounts is that the holder can deposit only Rs 50,000 per month and the withdrawal is capped at Rs 10,000, even during regular banking times. After demonetisation, the accounts have seen a deposit of over Rs 50,000 and therefore, they may have been converted into regular savings accounts as per rule.” According to the scheme, any holder who is capable of depositing over Rs 50,000 per month into an account is not seen as “poor”. The official added that the surge in the number of urban accounts is an indication that several persons in the unorganised employments in urban areas may have opened accounts following demonetisation. Since the demonetisation, the total number of Jan Dhan accounts has increased by 24,459 accounts to stand at a total of 90,18,940 accounts.
The official said, “Initially, everyone thought that Rs 2.5 lakh deposit into PMJDY accounts will also not be scrutinised. We know of cases where Jan Dhan account holders helped other persons deposit their money before the government pronounced that any deposit above Rs 50,000 into Jan Dhan accounts during this period will be under scrutiny. Demonetisation has also reduced the number of zero-balance accounts under Jan Dhan scheme in most areas. We still have more than a month to go for the deposits until December 30.”
A nodal officer of the Jan Dhan scheme from central Gujarat said that the actual number of rural accounts that converted automatically to savings accounts are far more than the figure indicates. The official said, “There have been significant number of accounts that have also been opened following demonetisation. However, statistics will only reveal the final difference. It is true that rural Jan Dhan accounts have seen huge deposits during the last two weeks and according to the rules of Jan Dhan banking, accounts which indicated high transaction have been converted into savings accounts.”