In a bid to ease the impact of Covid-19 on poor and low-income households, the government has announced a ₹1.7-lakh crore package under the Pradhan Mantri Gareeb Kalyan Scheme. Among one of the measures under the scheme, a cash transfer of ₹500 per month for the next three months will be provided to women holding Jan Dhan accounts. Of the total beneficiaries of 38 crore under Jan Dhan as of March 18, the number of accounts held by women is about 20.45 crore. The total cash transfer benefit amounts to about ₹30,000 crore.

The cash transfer benefit will aid about 53 per cent of the total number of Jan Dhan account holders.

Public sector banks that hold the chunk of the Jan Dhan accounts will be a key channel for this cash transfer. Of the 20.45 crore women-held Jan Dhan accounts, 78 per cent or 16 crore accounts is with PSU Banks, 18 per cent is with regional rural banks, and 3 per cent is in private sector banks.

Restricted activities

While the cash transfer can help the poor, the ongoing national lockdown may pose difficulties for people to withdraw cash at bank branches. While people can use the Rupay debit cards for purchases directly over the point of sales (PoS) terminals, how far this will be possible in remote areas needs to be seen. The shutdown of many shops and scarcity of certain food items are also key challenges. Currently there are over 29 crore Rupay debit cards issued to all Jan Dhan holders.

In FY19, transactions worth ₹80,800 crore were done through RuPay cards over PoS. In FY20 so far, about ₹1 lakh crore transactions were done through PoS. It is most likely that many of these transactions have been done in urban and semi-urban areas, given that the average ticket size per transaction has been about ₹1,100-1,300.

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