Jaitley orders probe into ‘gilded’ Jan Dhan accounts

The Finance Ministry has directed four banks to investigate charges that bank officials are artificially deflating the number of zero-balance accounts under the Pradhan Mantri Jan Dhan Yojana as a window-dressing measure.

“Four banks are investigating from their branches whether account-holders have put in money or business correspondents have done it,” Finance Minister Arun Jaitley told reporters after the first-quarter performance review of public sector banks here on Friday.

He was responding to a question on media reports that officials in some branches of Punjab and Sind Bank, Punjab National Bank, Bank of Baroda and Bank of India have themselves deposited a token amount of ₹1 in Jan Dhan accounts to reduce the number of zero-balance accounts.

Jaitley noted that there are 24 crore Jan Dhan accounts with total deposits of ₹42,000 crore.

“You don’t get ₹ 42,000 crore by just collecting ₹1 deposits. Of course, there are some accounts with zero balances. Banks are verifying details of those accounts where such small deposits of ₹1 were made,” he said.

After the controversy erupted, the Ministry emphasised that the absence of balances in Jan Dhan accounts does not diminish the benefits associated with them. There is no requirement of a minimum balance in such accounts, which the government sees as vehicles to effect direct benefit transfers to economically weaker sections.

Jaitley said he hoped that the RBI and the to-be-formed Monetary Policy Committee will “collectively” factor in the recent inflation trends and take a pragmatic decision at the next monetary policy review meeting in October.

‘Banks have enough teeth’ Banks continue to face challenges in respect of high non-performing assets, Jaitley acknowledged. Friday’s meeting had discussed the matter in detail, he said, and added that banks had been empowered to take effective steps to tackle the NPA situation.

The silver lining, he added, was that the steel and infrastructure sectors, which accounted for much of the NPAs, would soon see a revival of their fortunes.