The Government must fix the following criteria for PMJDY Beneficiaries
1. Only those who do not have any account with a scheduled commercial bank are entitled to open an account under this scheme;
2. To claim benefits under this scheme, the annual income of the account holder and his family shall be less than Rs.50,000 per year or so;
3. The account holder shall not own a house/flat in his name or in the name of his spouse (however, huts and temporary shelters provided by the government/NGOs will be excluded for this purpose);
4. Persons having movable and immovable properties whose aggregate market value is Rs.2 lakhs and more are kept outside the ambit of this scheme;
5. Minors and others who are incompetent to contract as per Indian Contract Act, 1872 are not eligible to open an account under this scheme;
6. RuPay Card shall be issued, only upon the account holder making the initial deposit in his/her account;
7. To be eligible for an overdraft, the applicant shall be residing in the same address for not less than 3 years;
8. ‘Satisfactory operations’ means not less than 2 customer initiated transactions per month for the past 6 months. Of these 12 transactions proposed, not less than 4 shall be a credit/deposit transaction;
9. The government will remit the personal accident insurance premium and life insurance premium directly to the insurance companies concerned;
10. Else, the applicable premium will be paid by the banks concerned within 24 hours of opening of accounts and the government will reimburse this amount on getting a simple statement containing the name of the account holder and his account number under CBS, on weekly basis without any delay.
11. Failure on the part of the government on this count will bring the scheme to a halt (Failure means delay by more than 15 days, repetitive delays, partial reimbursements etc.);
12. Rules regarding the rights of the nominee and legal heirs to be made plain and simple.
13. Claim procedure shall also be briefly explained in the passbooks supplied.
14. Separate, distinct-looking Passbooks must be issued by the banks for accounts opened under this scheme. They must contain all the necessary information and terms and conditions of the scheme, preferably printed in the vernacular language of the state concerned.
15. For DBT, other players like fertilisers and pesticides dealers, gas distributors, state governments, insurance companies, educational institutions and other government agencies/departments concerned must be consulted and their suggestions taken on record.
16. As against 2% of the DBT amount envisaged as at present, banks must be reimbursed a flat amount of Rs.30 per transaction, regardless of the amount.
17. The scheme shall be revisited at the end of every 2 years and necessary changes made, without hurting anybody’s interests.
Date: 02-09-2014
es= D s �+ q market value is Rs.2 lakhs and more are kept outside the ambit of this scheme;
Minors and others who are incompetent to contract as per Indian Contract Act, 1872 are not eligible to open an account under this scheme;
RuPay Card shall be issued, only upon the account holder making the initial deposit in his/her account;
To be eligible for an overdraft, the applicant shall be residing in the same address for not less than 3 years;
‘Satisfactory operations’ means not less than 2 customer initiated transactions per month for the past 6 months. Of these 12 transactions proposed, not less than 4 shall be a credit/deposit transaction;
The government will remit the personal accident insurance premium and life insurance premium directly to the insurance companies concerned;
Else, the applicable premium will be paid by the banks concerned within 24 hours of opening of accounts and the government will reimburse this amount on getting a simple statement containing the name of the account holder and his account number under CBS, on weekly basis without any delay.
Failure on the part of the government on this count will bring the scheme to a halt (Failure means delay by more than 15 days, repetitive delays, partial reimbursements etc.);
Rules regarding the rights of the nominee and legal heirs to be made plain and simple.
Claim procedure shall also be briefly explained in the passbooks supplied.
Separate, distinct-looking Passbooks must be issued by the banks for accounts opened under this scheme. They must contain all the necessary information and terms and conditions of the scheme, preferably printed in the vernacular language of the state concerned.
For DBT, other players like fertilisers and pesticides dealers, gas distributors, state governments, insurance companies, educational institutions and other government agencies/departments concerned must be consulted and their suggestions taken on record.
As against 2% of the DBT amount envisaged as at present, banks must be reimbursed a flat amount of Rs.30 per transaction, regardless of the amount.
The scheme shall be revisited at the end of every 2 years and necessary changes made, without hurting anybody’s interests.
Date: 02-09-2014
PMJDY – NO ANSWERS TO THESE QUESTIONS RAISED BY ME
There is no convincing answer in the Finance Ministry’s post in Facebook, to my questions in this regard.
1. Availability of adequate manpower in public sector banks to handle this additional work load.
2. Cost of RuPay cards to be issued. Who will bear these costs?
3. Transaction Costs and other Operational Costs involved.
4. Possible Bad Debts in overdraft accounts and their impact on individual banks' Profit & Loss Account (by way of interest reversal, provisions and write off).
5. Scope for large volume of customer complaints especially from the poor and illiterates. Of these complaints, ATM related complaints will constitute a major portion.
6. The delays and loopholes in DBT scheme affecting banker-customer relationships, leading to complaints and disputes.
7. Problems encountered by banks as a result of the insurance companies concerned settling the claims after a long delay or rejecting the claims.
8. Scope for human errors in managing these accounts and the bank personnel getting punished even for small, unintentional errors.
9. Duplication and Multiplication of bank accounts in the same name or persons belonging to the same family.
10. Finally, the over estimation of additional business (deposits as well as advances) accruing to the bank, by implementing this scheme. Past experience tells us that by financial inclusion, only 5% of the new accounts opened have regular transactions in them and thereby contribute to banks’ business growth by whatever measure. All other accounts turn dormant over a period of time.
Date: 01-09-2014
SOME QUESTIONS ON ‘PRIME MINISTER’S JAN DHAN YOJANA’
In today's newspaper, it has been mentioned that life insurance cover of Rs.30,000 is also added to the account holders under this scheme, as a ‘top up’ (or as an after- thought).
I have some questions with regard to this scheme itself. They are:
- What is the mechanism in place now to filter ineligible persons who enrol themselves under this scheme?
- For instance, people having sizeable assured income every month have also opened accounts under this scheme. There was no tool available to stop them.
- Those who already have a bank account have also opened accounts under this scheme, anticipating several benefits under this scheme free of cost. Was this the objective of this scheme?
- More than 1 person from the same family have opened accounts, may be with different banks or different branches of the same bank. This will lead to government benefits reaching many members from the same family. Why did the government not think about it in advance and take necessary precautionary steps to check this possibility?
- Similarly, those who already got benefit (subsidy/margin/interest waiver/write off) in any of their previous dealings with any bank should have been kept out of coverage of this scheme. Why was it not done?
- Especially when the KYC documents given to different banks/branches differ (like PAN Card at place and Driving License at another) and proof of address also differs and Date of Birth is only orally declared, banks do not have any software at present to merge the identical particulars and treat all the accounts of a person as one only, for this purpose. In such case, what is the filter available to prevent it?
- For this purpose, one common data base of all banks must be prepared, by pooling up data of all banks implementing this scheme. Why was this not conceived before?
- When the account holders become eligible for the overdraft facility proposed under the scheme?
- In several places, even minors have opened accounts under this scheme. They are not eligible for Debit Cards and Overdrafts, as they are incompetent to enter into valid contracts as per Indian Contracts Act, 1872. Why was this point not discussed anywhere?
- Why even today the minute details of the scheme like the target group, eligibility criteria, possible errors and ways to avoid them etc. have not been properly circulated to all banks?
As I had already remarked, there is no benefit accruing to the banks nor the bank staff, by implementing this most challenging, strenuous and labourious job.
I have one humble request. Let the bank staff be at least spared from any KYC deviations for the purpose of opening of millions of accounts under this scheme within a very, very short period.
Date: 29-08-2014
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