RBI cautions banks on misuse of Jan Dhan Yojana scheme

PTI Updated - November 25, 2017 at 11:58 AM.

(FILES) In this photograph taken on July 31, 2012, the facade of the Reserve Bank of India (RBI) head office is pictured in Mumbai. India's struggling economy is crying out for interest rate cuts to spur growth but with the rupee on the ropes monetary easing is out of the question at next week's central bank meeting on July 30, 2013, analysts say. AFP PHOTO/ Punit PARANJPE/ FILES

The Reserve Bank today warned the banks to be more careful while opening accounts under the Jan Dhan Yojana, saying that a single individual could open multiple accounts in the lure of Rs 1 lakh insurance cover.

“There are some caveats when the banks are implementing the financial inclusion scheme under the recently launched Jan Dhan programme,” RBI Executive Director P Vijay Bhaskar said at a CII seminar here today.

He said people could open accounts in different banks using different identity documents like PAN card, Aadhar among others in the lure of getting insurance cover of Rs 1 lakh from all the banks.

The banks should have a single information sharing system by which this possible misuse could be stopped.

Another possible threat was ‘smurfing’, the RBI official said.

In this case, hawala operators would split the whole amount into several small units beyond the threshold using several bank accounts and send money overseas.

The last was ‘money mules’ by which an individual would operate through another person’s bank account.

Talking about the north—eastern region, he said the SLBCs and the SLCCs should take steps to improve the credit—deposit ratio of the region as the CD ratio was much lower than the national average.

Earlier this week, RBI Governor Raghuram Rajan had cautioned banks on the risks involved in just hunting for numbers with regards to Jan Dhan scheme, asking them not to compromise on core objectives of the programme.

“When we roll out the scheme, we have to make sure it does not go off the track. The target is universality, not just speed and numbers,” Rajan had said.

Published on September 19, 2014 13:54