The total amount of money held under the accounts opened under the Jan-Dhan Yojana is once again nearing the all-time high seen during demonetization, and has increased by nearly 10% over a period 4 months, puzzling banking officials.
Numbers from RBI also show that Jan Dhan accounts have stopped losing money and that the average amount held in them have also started rising after declining for a year.
As of Jan 25, a total of Rs 73,589 cr rupees is held under 31 cr Jan Dhan accounts, up sharply from Rs 63,971 cr in early April and from Rs 67,330 in October.
DEMONETIZATION HIGH
The highest level of deposits held in Jan Dhan accounts was reached on December 7, 2016 at the height of the demonetization cash crunch.
Before demonetization, there were 25.5 cr Jan Dhan accounts, and the total amount held in them was Rs 45,637 cr as of Nov 9, 2016.
This meant an average balance of Rs 1,790 per account.
Over the next one month, the total amount held in Jan Dhan accounts increased by 29,000 cr to Rs 74,610 cr as the government required old notes to be deposited into bank accounts.
During this one month, the total number of Jan Dhan accounts increased only modestly to 25.9 cr from 25.5 cr.
As a result, by Dec 7, the average balance of such accounts jumped from Rs 1,790 to Rs 2,880 over a period of one month.
Soon after, the government started easing the withdrawal norms.
This resulted in a steady decline in the total amount saved in such accounts.
This trend found a bottom in early April, 20017 when the overall amount reached a low of Rs 63,971 cr. The average amount in an account also fell to Rs 2,266.
APRIL TO OCTOBER – ACCOUNT GROWTH
From April, the total amount held in Jan Dhan accounts starting climbing again, but this was led by an increase in the number of such accounts, rather than by people putting more and more money into their accounts.
Over the next six months, the total number of such accounts increased by about 8% to 30.45 cr from 28.23 cr, and the total amount held in them also increased by about Rs 3,350 cr to Rs 67,330 cr.
However, the average balance went down to Rs 2,211 as of Oct 11, because the increase in funds was driven by the increase in the number of accounts, and not by the increase in deposits as such.
OCTOBER-JAN – DEPOSIT GROWTH
However, from October 11 to January 24, the total number of accounts increased by only 1.8%, but the total amount stored in all the accounts has jumped by 9.3%.
No one is quite sure as to why suddenly more money is finding its way into Jan Dhan accounts, but industry insiders speculate that it may have had to do with the push to get all bank accounts connected to Aadhaar numbers.
With the total amount reaching Rs 73,589 cr in January, chances are that the total amount held in such accounts will cross, or may have already crossed, the demonetization high of Rs 74,610 cr this month.