Banking and Insurance - Laws and Practice · Various Government Schemes

Pradhan Mantri Jan Dhan Yojana (PMJDY): Features and Benefits

Updated 11 October 2026 · Fact-checked

PMJDY is India's national mission for financial inclusion, launched on 28 August 2014. It gives every unbanked adult a zero-balance basic savings account with a RuPay debit card, accident insurance, and an overdraft facility. In an exam, state the objective, the pillars, the account features, then the card, overdraft and insurance benefits with limits.

Understand Pradhan Mantri Jan Dhan Yojana (PMJDY)

Millions of Indian households had no bank account. Without one they could not save safely, receive subsidies directly, borrow formally or buy insurance. Pradhan Mantri Jan Dhan Yojana (PMJDY) was launched on 28 August 2014 to fix this. It is called the National Mission for Financial Inclusion.

The core product is a Basic Savings Bank Deposit Account (BSBDA). It needs no minimum balance. It can be opened at a bank branch or through a Business Correspondent (BC) outlet. The account holder gets a RuPay debit card, which carries built-in accident insurance. After satisfactory operation of the account, the holder becomes eligible for an overdraft (OD).

The original design rested on six pillars: universal access to banking facilities; a basic account with a RuPay card and overdraft for every household; financial literacy; a credit guarantee fund; micro-insurance; and pension for the unorganised sector. Phase I ran from August 2014 to August 2015 and Phase II from August 2015 to August 2018.

In August 2018 the mission was extended without an end date. The focus moved from every household to every unbanked adult. The overdraft limit and the accident cover on new RuPay cards were also raised. Accounts also help in Direct Benefit Transfer (DBT), so subsidies reach the beneficiary's account without leakage.

For your exam, treat PMJDY as a fact-and-limit topic. Learn the pillars, the account features and the limits. Then connect them to the purpose: inclusion, savings, credit and protection. Always check the latest limits in the ICSI study material, because the scheme has been revised.

Key rules to remember

Launch and nature: Launched 28 August 2014; National Mission for Financial Inclusion; The scheme was announced on 15 August 2014 and launched on 28 August 2014. Extended after August 2018 without an end date.
Six pillars (original): Banking access + Basic account with RuPay card and OD + Financial literacy + Credit guarantee fund + Micro-insurance + Pension for unorganised sector; List all six in the answer. Mention that the later extension shifted focus from households to unbanked adults.
Account type: BSBDA: zero balance, no minimum balance, RuPay debit card; Can be opened at a branch or a Business Correspondent outlet. Minors aged 10 and above can open an account, subject to the scheme guidelines.
Overdraft limit (after 2018 revision): OD up to ₹10,000 per account; up to ₹2,000 without conditions; Earlier limit was ₹5,000. The upper age limit for OD was raised from 60 to 65. Other OD above ₹2,000 depends on satisfactory operation of the account.
RuPay accident insurance: ₹2,00,000 for cards issued after 28 August 2018; ₹1,00,000 for earlier cards; The cover applies if the card was used for at least one successful transaction within a stipulated period (90 days) before the accident.
Life cover (older accounts): ₹30,000 for eligible accounts opened between 15 August 2014 and 31 January 2015; This was a time-bound benefit, subject to eligibility conditions. State it only as a historical feature.

How to solve Pradhan Mantri Jan Dhan Yojana (PMJDY) questions

Use this method for any PMJDY question, whether it asks you to explain the scheme, list benefits or apply a limit to a fact pattern.

1Identify what is asked: objective, pillars, account features, a specific benefit, or a case on eligibility.
2Open with one line on the scheme: launched 28 August 2014, National Mission for Financial Inclusion, aims at banking for all unbanked adults.
3State the relevant rule or feature in plain words: pillars, BSBDA features, RuPay card, overdraft or insurance.
4Give the exact limit and condition, such as ₹10,000 OD, ₹2,000 without conditions, ₹2 lakh accident cover and the card-use condition.
5Apply the rule to the facts: check the age, the date of card issue, the account's operation period and the transaction history.
6Conclude clearly with the benefit or limit that applies, and note any condition that is not met.
7Add one practical point if it fits: BC outlets, DBT or Aadhaar seeding.

Quickest way: Four-box recall: Account, Card, Credit, Cover

When to use it: Use it when time is short and the question asks for features or benefits of PMJDY.

Account: zero-balance BSBDA at a branch or BC outlet; no minimum balance.
Card: RuPay debit card with accident insurance of ₹2 lakh (new cards after 28 August 2018).
Credit: overdraft up to ₹10,000; ₹2,000 without conditions; age limit 65.
Cover and reach: pillars, DBT, micro-insurance and pension access, financial literacy.
Write one line on each box, then add the pillars if marks allow.

Common mistakes in Pradhan Mantri Jan Dhan Yojana (PMJDY)

Quoting the old overdraft limit of ₹5,000 as the current limit.
Older notes and videos give the original 2014 figure.
Fix: Write ₹10,000 as the revised limit and mention that it was ₹5,000 earlier.
Stating the accident cover as ₹1 lakh for all RuPay cards.
Students remember only the original figure.
Fix: Give both: ₹1 lakh for cards issued before 28 August 2018 and ₹2 lakh for cards issued after.
Ignoring the card-use condition for insurance claims.
Students treat the cover as automatic.
Fix: State that the card must have been used for a successful transaction within the stipulated 90 days before the accident.
Listing fewer than six pillars or mixing them with other schemes.
The pillars blend into PMJJBY, PMSBY and APY features.
Fix: Remember the sequence: access, account with card and OD, literacy, guarantee fund, micro-insurance, pension.
Saying the overdraft is available as soon as the account is opened.
Students confuse OD with the zero-balance feature.
Fix: State that OD depends on satisfactory operation of the account; only the first ₹2,000 is free of conditions.
Writing that PMJDY ended in 2018.
Phase II is described as running to August 2018.
Fix: Say the scheme was extended beyond August 2018 without an end date, focusing on unbanked adults.

Worked examples

Example 1

Ramesh opened a PMJDY account in 2021 and received a RuPay card. He used it at a shop 40 days ago. He then died in a road accident. What accident insurance cover is available to his family?

Show the solution

The card was issued after 28 August 2018, so the enhanced cover of ₹2,00,000 applies.
The condition is that the card was used for a successful transaction within the stipulated 90 days before the accident.
His last transaction was 40 days before the accident, which is within 90 days, so the condition is met.
The cover is payable under the RuPay card insurance, subject to the claim procedure.

Answer: His family can claim accident insurance cover of ₹2,00,000, because the card was issued after 28 August 2018 and was used within 90 days before the accident.

Example 2

Sunita, aged 45, has a PMJDY account for 10 months, operated satisfactorily. She asks for an overdraft of ₹8,000. Advise on the position and the limit.

Show the solution

The OD facility under the revised scheme goes up to ₹10,000 per account.
The age limit for OD is 65, and she is 45, so she is within it.
The account has been operated satisfactorily, so the conditional OD above ₹2,000 can be considered.
₹8,000 is below the ₹10,000 ceiling, so the amount asked for is within the scheme limit.
The bank still assesses the account's operation and the KYC position before sanctioning.

Answer: Sunita is eligible for an overdraft of ₹8,000, which is within the ₹10,000 limit. ₹2,000 would have been available without conditions, but the rest depends on satisfactory operation of the account, which she has met.

Exam tips

Write the dates and limits precisely: 28 August 2014, ₹10,000 OD, ₹2,000 without conditions, ₹2 lakh accident cover.
Always show the old and revised limits side by side; it proves you know the 2018 changes.
In case-based questions, check three facts before answering: date of card issue, age of holder and account operation period.
Use short bullet points for pillars and benefits, then close with a one-line conclusion.
Link PMJDY to PMJJBY, PMSBY and APY in your answer; these are often asked together.

Practice questions from Various Government Schemes

Pradhan Mantri Jan Dhan Yojana (PMJDY): frequently asked questions

What are the objectives of PMJDY?

PMJDY aims to give every unbanked adult access to formal banking, savings, credit, insurance and pension. It also supports direct transfer of subsidies and builds financial literacy.

Who can open a PMJDY account?

Any individual who does not have a bank account can open one, and the scheme now focuses on unbanked adults. Minors aged 10 and above can open an account, subject to the scheme guidelines. The account is opened at a bank branch or BC outlet with the prescribed KYC documents.

What is the overdraft limit under PMJDY?

The revised limit is ₹10,000 per account. Up to ₹2,000 is available without conditions. The age limit for overdraft was raised from 60 to 65 years.

How much accident insurance does the PMJDY RuPay card give?

Cards issued after 28 August 2018 carry accident insurance cover of ₹2 lakh. Earlier cards carry ₹1 lakh. The card must have been used for a successful transaction within the stipulated period before the accident.