UPSC Mains 2016 GS Paper 3 Q3: model answer
Pradhan Mantri Jan-Dhan Yojana (PMJDY) is necessary for bringing unbanked to the institutional finance fold. Do you agree with this for financial inclusion of the poorer section of the Indian society? Give arguments to justify your opinion.
What the question wants
Say whether PMJDY is necessary for bringing the poor into formal finance, and justify your view with arguments.
How to structure it
Opinion with reasons.
- Stand
- Why it is necessary
- Where it falls short
- What completes it
- Conclusion
How to think it through
Agree, but it is necessary, not sufficient. Launched on 28 August 2014, PMJDY has over 55 crore accounts, more than half held by women. It enabled DBT and the JAM trinity. Weak spots: dormant accounts, low credit, thin insurance use. An account is the door; credit, insurance and literacy are the rooms.
Model answer
On 28 August 2014 banks opened about 1.5 crore accounts in a single day. Pradhan Mantri Jan-Dhan Yojana today has over 55 crore accounts, more than half held by women and two-thirds in rural and semi-urban areas. I agree that it is necessary for financial inclusion, but it is not sufficient.
Why it is necessary
- A first door: in 2011 only 35% of Indian adults had a bank account (Global Findex). A zero-balance account removed the entry barrier.
- DBT backbone: the JAM trinity (Jan Dhan, Aadhaar, Mobile) carries LPG subsidy, PM-KISAN and pensions straight to beneficiaries, cutting leakage.
- Crisis delivery: during the 2020 lockdown, ₹500 a month went into about 20 crore women's Jan Dhan accounts.
- Gateway to other schemes: accident insurance on the RuPay card, an overdraft facility, and links to PMJJBY, PMSBY and Atal Pension Yojana.
- Women's agency: an account in her own name gives a woman control over money.
Where it falls short
- Dormancy: a sizeable share of accounts sees little or no activity.
- Access is not usage: small overdraft take-up and little formal credit; moneylenders persist.
- Financial literacy and fraud: new users are easy targets for cyber fraud.
What completes it
Credit through MUDRA and SHG–bank linkage, micro-insurance, UPI for daily use, and literacy camps turn an account into financial security.
Conclusion
PMJDY built the road; the poor now need reasons to travel on it every day. Inclusion is measured by use, not by account numbers.
Draw: A ladder: account → payments → savings → credit → insurance → pension.
Keywords, cases and data to drop in
PMJDY (28 August 2014), zero-balance account, RuPay, JAM trinity, DBT, overdraft, dormant accounts, Findex, UPI, SHG–bank linkage.
Where most answers lose marks
- Giving only account numbers without your own reasoned opinion. The question asks 'Do you agree?'
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Question text as printed in the official UPSC Civil Services (Main) question paper. The model answer is original Battle IAS work; use it to learn structure, not to memorise.
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