In its review of the Department of Financial Services, the Department-related Parliamentary Standing Committee on Finance noted that while financial inclusion programmes have expanded access to banking and pension services, improving long-term participation and fiscal sustainability remains important.
The committee observed that the Jan Dhan scheme has achieved significant scale, with 57.64 crore accounts opened and deposits of around ₹2.9 lakh crore. However, about 73.9% of these accounts are currently operative, indicating that nearly a quarter of accounts remain inactive.
According to the panel, the next phase of financial inclusion should focus on increasing account usage rather than only expanding the number of accounts. Encouraging regular transactions and linking accounts with other financial services could help improve participation in the formal financial system.
The committee also flagged concerns over contribution persistency under the Atal Pension Yojana, which targets workers in the unorganised sector. It noted that the scheme’s persistency rate is around 50–51%, suggesting that a significant number of subscribers discontinue contributions.
Lower persistency affects the sustainability of the scheme’s pension model. The government currently provides gap funding of about ₹202 crore annually to support guaranteed pension payouts under the programme.
The panel suggested that improving subscriber retention will be important for the long-term viability of the scheme and indicated that the government may examine alternative models, including arrangements involving pension fund managers, to strengthen sustainability.
Separately, the committee noted a sharp increase in the subsidy required to support the Pradhan Mantri Vaya Vandana Yojana, a pension programme for senior citizens implemented through Life Insurance Corporation of India.
According to the report, the subsidy has risen from ₹27.58 crore in 2022-23 to ₹422.78 crore in 2023-24, and further to ₹507.22 crore in 2024-25. The government has projected a subsidy requirement of ₹597.33 crore for 2025-26.
Under the scheme, the government compensates the insurer for any shortfall arising from the guaranteed pension returns offered to senior citizens.
The committee said monitoring the long-term fiscal implications of such guarantees would be important as participation in pension schemes expands.
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