Question : Jan Dhan Yojana has induced millions of people to open their bank accounts. It will lead to an increase in __________
Option 1: Inflation
Option 2: Primary deposits
Option 3: Deflation
Option 4: Value of currency
Correct Answer: Primary deposits
Solution : The correct answer is (b). Primary deposits
The implementation of the Jan Dhan Yojana, a financial inclusion program in India, has indeed encouraged millions of people to open bank accounts. This has significant implications for the banking system and the economy. One of the direct effects is an increase in primary deposits.
Primary deposits refer to deposits made directly by customers into their bank accounts. With more individuals opening bank accounts as a result of the Jan Dhan Yojana, there is a rise in primary deposits. These deposits contribute to the overall deposit base of banks, which they can then utilize for lending and other financial activities.
The increase in primary deposits can have a positive impact on the banking system, as it provides a stable and reliable source of funds for banks to support lending and economic growth. It also promotes financial inclusion by allowing individuals to access various banking services and participate in formal financial systems.
