I’m hearing this a lot these days. People coming and asking to convert their existing account to Pradhan Mantri Jan Dhan account aka PMJDY. And some ask to link their existing account to Jan Dhan account. All this, I suppose, is a result of ill advertising by the Government. The Advertisement always flashes the benefits of the yojana but never mentions the conditions one needs to satisfy to get those benefits.
So, on this occasion, I’ll clarify a few things related to a Jan Dhan account.
What is a Jan Dhan account?
It is essentially a BSBDA account which is in existence since a long time. All the transaction limits of BSBDA account are applicable to Jan Dhan account a well.
Benefits of Jan Dhan account?
All the benefits of a Jan Dhan account don’t come from the account itself but come from the Rupay card that one gets after opening a Jan Dhan account. Benefits include Rs.1 lac personal accident insurance, Rs.30000 health insurance for the head of the family and Rs.5000 (variable) Over Draft facility after 6 months of acceptable account usage (initially).
Conditions to avail the benefits?
As mentioned above, to get Rs.5000 OD facility, one MUST use his Jan Dhan account regularly. What actually is an acceptable usage; is the prerogative of the respective bank. So simply put; if one opens a PMJDY account because he will get something from the centre (upar se aana); that is not going to happen. For the Rs.1 lakh accident insurance, one has to use his Rupay debit card once every 45 days. When this doesn’t happen, one will not get Rs.1 lakh insurance if in case the sad thing occurs.
What if you already have a bank account?
Then there is absolutely no need to open a Jan Dhan account. You can simply visit your bank and apply for a Rupay ATM card. You will get same benefits as those applicable to a Jan Dhan account.
Linking Aadhaar to bank account?
Linking your Aadhaar to bank account doesn’t convert your account to a Jan dhan account. It simple makes your account eligible to get benefits, such as Direct Benefit Transfer (DBT) etc.
Going forward, all DBT’s (such as LPG subsidy) will be handled via your aadhaar, so it is essential to link your existing bank account (or a Jan dhan account) with your aadhaar number.