Many analysts attribute the recent electoral success of the Bharatiya Janata Party to the effective implementation of social sector schemes launched by the government of India. The Pradhan Mantri Jan Dhan Yojana (PMJDY) is one such scheme, extremely ambitious in scope. It gave every person in India a bank account, including hundreds of millions of poor, financially excluded individuals. Are these accounts used and if so, how active is the usage? In a recent paper, we analyse these questions.
We find that activity is slow to start but picks up and shows convergence to the level of normal savings bank accounts opened in this period. The formerly unbanked may never have stepped into a bank branch before the PMJDY, but once they do so, they exhibit a surprising demand for banking services… Read more.
Author:
N.R.Prabhala is Professor of Finance at the University of Maryland.
Yakshup Chopra is a Researcher with the Centre for Analytical Finance at the Indian School of Business.
Prasanna Tantri is Senior Associate Director with the Centre for Analytical Finance at the Indian School of Business
Source: This article is reproduced from LiveMint dated April 17, 2017.