In India, millions of people in rural areas lacked access to basic banking and financial services. This financial exclusion resulted in limited savings options, an inability to access credit, and difficulties in receiving government subsidies. The Pradhan Mantri Jan Dhan Yojana was launched in 2014 by Prime Minister Narendra Modi as the National Mission for Financial Inclusion to bring the vast unbanked Indians into the formal banking umbrella. The scheme is guided by the principles of 'banking the unbanked, securing the unsecured, funding the unfunded, and serving the underserved'.

This scheme offers basic banking services such as savings accounts, RuPay debit cards with accident insurance, and mobile banking facilities, along with phased introductions of credit, insurance, and pension products. On 28th
August 2025, the country witnessed the 11th anniversary of Pradhan Matri Jan Dhan Yojana, the world's biggest financial inclusion drive.

Since its inception, PMJDY has played a pivotal role in enhancing financial literacy, facilitating direct benefit transfers, promoting social security, and fostering the widespread adoption of digital payments, thus revolutionising the financial landscape of India. The scheme has been introduced with the prime objective of reaching the unreached in terms of financial education and inclusion, and others are as follows:

· To bank the unbanked and reach the unreached.
· To provide universal access to banking facilities, ensuring that every household has at least one bank account.
· To promote financial literacy and awareness.
· To provide easy access to credit.
· To facilitate the direct transfer of government benefits to beneficiaries' bank accounts.
· To provide social security to the financially excluded population of the country.

Tracing India's financial inclusion journey before PMJDY

The financial inclusion initiatives in our country can be traced back to the 1950s, with significant developments over the decades. A few remarkable efforts include the framework of Priority Sector Lending in 1986, nationalisation of selected private banks in 1969, and the launch of the lead bank scheme in December 1969.

Another one such initiative was the Branch Expansion policy by RBI in the 1970s, requiring a specific number of branches to be opened in rural areas for every branch opened in an urban area. In the later period, the initiative of No Frill accounts and Bank Correspondent model can be seen as the foundation stones to today's expanded formal banking services to every nook and corner of the country.

The first reference to the term' Financial Inclusion' was made in the Reserve Bank of India's annual report in 2005-26. Census 2011 estimated that out of 24.67 crore households in the country, 14.48 crore (58.7 percent) households had access to banking services. Of the 16.78 crore rural households, 9.14 crore (54.46 percent) were availing banking services. Of the 7.89 crore urban households, 5.34 crore (67.68 percent) households were availing banking services (Figure 1). As on 31st March 2014, the banking network in the country involved a bank branch network of 1,15,082 and 1,60,055. Of ATMs, out of that 43,962 branches (38.2 percent) and 23,334 ATMs (14.58 percent) are in rural areas. Moreover, there are more than 1.4 lac Business Correspondents (BCs). Public Sector Banks and Regional Rural Banks succeeded in covering 7.22 crore households out of 13.14 crore households assigned to them till 31st May 2014. It was estimated that nearly 6 crore households in rural and 1.5 crore households in urban areas remained unbanked.

To read more, please subscribe.