Post-demonetisation deposits in Jan Dhan accounts hardly significant

The government had, moreover, capped deposits into Jan Dhan accounts at Rs 50,000 on November 15.

Published: 04th December 2016 04:49 PM  |   Last Updated: 04th December 2016 04:49 PM   |  A+A-

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For representational purpose


NEW DELHI: The post-demonetisation government narrative that the poor are being "used" by black money hoarders and huge amounts are being deposited in their Jan Dhan accounts does not stand up to scrutiny.

Prime Minister Narendra Modi, in his rally in Moradabad on Saturday, touched upon this issue and said that he "will find a way" of ensuring that the money deposited with Jan Dhan accounts remains with the poor account holder, while those who made the deposits are sent to jail.

However, the reality is that the money that has come into the accounts is hardly significant in the context of the drive to unearth black money and could -- barring a few exceptions -- be easily justified in most cases.

Consider: As per the government's figures, as on November 30, there were a whopping 25.78 crore Jan Dhan accounts. Of these, 19.88 crore were active accounts and 5.9 crore accounts had zero balance.

On November 9 -- a day after Modi made his dramatic announcement demonetising Rs 500 and Rs 1,000 notes -- the active accounts had deposits of Rs 45,636.61 crore.

On November 30, as per the Pradhan Mantri Jan Dhan Yojana website, the amount of deposits in the 19.88 crore active accounts had swollen to Rs 74,321.55 crore -- pointing to deposits of Rs 28,684.94 crore.

While that may seem like a big number, it works out to an average deposit per active account of a mere Rs 1,442.9 (yes, less than fifteen hundred rupees).

There have, however, been some media reports that contended that only about three crore of the active accounts -- and not all -- have seen the surge in deposits after November 9.

Even if this were the case, the average deposit per account would be just Rs 9,561.64 (less than 10,000 rupees).

The government had, moreover, capped deposits into Jan Dhan accounts at Rs 50,000 on November 15.

Put another way, the average deposit in the active accounts was Rs about 1,789 on November 9. This had risen to about Rs 3,232 on November 30.

Hardly numbers that should send the taxmen scrambling.

Although targeted at getting the unbanked poor into the banking system, anecdotal evidence suggests that a good number of those roped in to open the accounts were not those in extreme poverty, but those employed in the unorganised sector - drivers, maids, industrial workers, etc.

These are people who earn anywhere between Rs 8,000 to Rs 20,000 and could conceivably have saved up the sums that have been deposited.

The government's narrative that the Jan Dhan accounts of the poor are being used to whiten black money and bring it into a banking system appears to be somewhat specious.


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