1. The Direct Cash Transfer
Scheme “Aapka paisa
MBA 1- E
2. About the scheme
3. International Practices
4. Programs part of DBT
5. Primary aims
6. How does it work?
7. Aadhaar and its application.
9. National Child Labour
11. Financial details
12. SWOT analysis
13. Recent Updates
14. Success Story
16. Learning and Conclusion
The Direct Cash Transfer Scheme “Aapka paisa aapke haath"
Direct Benefit cashTransfer or DBT is an anti-poverty program
launched by Government of India on 1 January 2013. This program
aims to transfer subsidies directly to the people living below poverty
"Aapka paisa aapke haath" concept has brought happiness to
the poor who have received the benefits directly into their
The Prime Minister has set up three-tier architecture for
monitoring the scheme. This includes a national ministerial
committee, a national executive committee and
4. The scheme has now been rechristened as Direct Benefits
Transfer (DBT) and curtailed beneficiary districts to 20.
At least two lakh beneficiaries are expected to benefit from
DBT scheme immediately. Food, fertilisers, and fuel have
been kept out of its purview for the present.
“Direct Cash Transfer” scheme which would be rolled out in
phases, initially covering 43 districts (out of 51 announced
earlier) from 1 January 2013 and then entire country (640
districts) by end 2013.
5. The Direct Cash Transfer Scheme “Aapka paisa aapke
About the Scheme
• Direct cash transfer scheme aims to reduce
leakages, cut down corruption, eliminate
middlemen, target beneficiaries better and speed
up transfer of benefits to eligible individuals.
• To meet the socio-developmental objectives of
poverty elimination and to inclusive growth, a
number of Government sponsored programs and
schemes have been introduced.
• However, efficiency and effectiveness have not
been achieved by any of the programs and
7. INTERNATIONAL PRACTICES
• Cash Transfer schemes originated in middle-income Latin American countries.
• In Asia, Bangladesh had a Female Stipend Programme as early as 1982 followed by
a Food for Education Programme in 1993. Food grants were later converted to cash
grants in 2002.
• Several countries including Jamaica, Philippines, Turkey, Chile, Mexico, Indonesia,
South Africa, Morocco and United States have adopted this system in the form of
Conditional Cash Transfer (CCT) programs.
• The largest and the most successful conditional cash transfer program is the Bolsa
Família that provided 100 percent of Brazil's poor in 2007.
8. The Direct Cash Transfer Scheme
“Aapka paisa aapke haath"
National Child Labour Project
PROGRAMS PART OF DBT
9. To bring transparency and terminate pilferage
In DBT, benefit or subsidy will be directly transferred to the citizens living below
No subsidy will be given to those people who don't require it.
The DBT scheme aims at cutting a subsidy bill of ₹1,64,000 crores apart from other
benefits like better delivery, accurate targeting, broader choice, reducing delays and
LPG and kerosene subsidies, pension payments, scholarships and employment
guarantee scheme payments as well as benefits under other government welfare
programmes will be made directly to beneficiaries.
10. HOW DOES IT WORK?
The money is directly transferred into bank
accounts of beneficiaries having Aadhar cards.
LPG and kerosene subsidies, pension
payments, scholarships and employment
guarantee scheme payments as well as benefits
under other government welfare programmes
will be made directly to beneficiaries.
Under the DBT each and every beneficiary has
to establish his identity and eligibility many
times by producing multiple documents for
verification. The verification of such
documents is done by multiple authorities.
12. What is Aadhaar?
Aadhaar card, consisting a12 digit number
issued for every individual, including infants.
Each individual of a family will have separate
Aadhaar UID number. While enrollment it
verifies all the documents pertaining to an
individual and collects biometric information -
photograph, ten fingerprints and iris through
scanning. The Unique
Identification Authority of India
(UIDAI) will issue for all residents
in India (on a voluntary basis).
13. Government can transfer the benefit amount directly to the bank
account of the beneficiaries to which their Aadhaar card is linked. In
this way we can avoid
middlemen eating away the government fund.
For the rural people if the bank branches are not there in their village
we can provide them the micro ATM facility where he need to verify
his identity by making a thumb impression on the microATM.
Then the person carrying the micro ATM will pay the benefit amount
and the bank will deduct this amount from the beneficiary’s account.
UID and its applications
15. Direct Benefit Transfer for LPG consumer (DBTL) is the scheme aimed to improve
the subsidy administration of LPG across the country.
As per this scheme an LPG consumer will get his/her cylinder at full market price
and the differential between subsidized price and full market price i.e. the subsidy
will be transferred to his/her bank account up to a capped limit(9 cylinders in a
DBTL by Ministry of Petroleum and Natural Gas is the scheme aimed to improve
the subsidy administration of LPG across the country.
LIQUIFIED PETROLEIUM GAS
16. Users can access list of aadhaar enabled banks, DBTL helpline, DBTL forms,
etc. Details related to checking aadhaar enrollment status, aadhaar enrollment
centres, generating e-aadhaar, linking aadhaar to LPG consumer number, etc. are
LPG for Domestic Cooking is heavily subsidized. So people use fake
connections and misuse the benefits. If Aadhaar card is integrated with the
customer database of LPG they can eliminate illegal diversion of cylinders.
From April 1,2014 residents can avail subsidy on 12 cylinders but will have to
pay the non-subsidised rate for the 13th and thereon.
18. We are soon going to go in for direct benefits transfer for this amount,”
said A.C. Pandey, Joint Secretary, Labour Ministry.
Overall, there are 7,311 such schools under the NCLP scheme and about
8.52 lakh children have been mainstreamed into formal education.
There had been a 45 per cent decline in child labour in India from 90.45
lakh in 2004-05 to 49 lakh in 2009-19, mainly due to MGNREGA, the
rural job scheme, and Right to Education. Assured of 100 days work under
the job scheme, parents are now sending children to school, which is
making all the difference
NATIONAL CHILD LABOUR
20. In fiscal year 2012-2013, government of Andhra Pradesh channelled $1.2
billion of NREGA and social security pension
Security pensions (SSP) payments through this EBT channel. This year the
amount is expected to increase to $1.5 billion.
Various departments at the state level are involved in implementing several
cash transfer schemes.
Government has built a unique skill set in the smart card and pensions unit at
the state level, as well as at the national level.
Payments expert for every district to coordinate this activity.
EMLOYMENT GUARANTEE ACT
21. According to government reported data, in 2012-13, 67% of NREGA payments
were delivered Summary of Results on December 2013 electronically, and the
remaining were done through a manual process.
In the electronic system, the percentage of payments delivered within the
stipulated two weeks was 25%, 60% within thirty days and the remaining 15%
were delivered after thirty day’s. There is a disbursement window each month of
ten days for making payments.
Pensions are paid during the first six days of the month, while NREGA
payments vary according to work completed.
During the payment window, the agent does over a hundred transactions per day.
22. FINANCIAL DETAILS
The Government had allocated Rs250crore for various welfare
programmes under the DBT scheme launched about seven months
ago covering distribution of LPG subsidy, pensions, scholarships.
So far, over 40crore Aadhaar enrolments have been done, and the
Plan panel was hopeful of achieving the target of 60crore by 2014.
Till June 30, 2013, a total of about Rs35.53crore was disbursed
under various scheme, and in July 2013 alone, about Rs14.76crore
The government will disburse Rs.4 lakh crore every year, with each
BPL (below poverty line) family getting between Rs.3,000 and
Rs.4,000 a month in a designated bank account. Each family will
get its cash transfer on the basis of its Aadhar.
24. About Rs32 lakh has been disbursed under the Direct Benefit Transfer (DBT)
scheme through the Aadhaar Payment Bridge, the Planning Commission said.
It is ascertained that the Public Distribution System (PDS) is so ineffective that
58% of the subsidized grains do not reach the targeted group and almost a third
of it is trajected off the supply chain.
According to the Finance Ministry, the inefficiencies of the PDS cause the
government to spend ₹3.65 for transferring ₹1 to the poor.
To generate budget savings and reduce corruption, the Government of India
launched the Direct Benefit Transfer (DBT) scheme on January 1st, 2013.
The DBT scheme aims at cutting a subsidy bill of ₹1,64,000crores apart from
other benefits like better delivery.
30. RECENT UPDATES
The government is likely to announce a boost to DBT scheme in the
forthcoming budget and delink it from Aadhaar cards.
The move is part of the revamp of the financial inclusion .
The campaign will focus more sharply on empowering business
correspondents to push financial products in the rural market.
The intention is that the beneficiary should continue to directly receive the
benefit, which is possible without Aadhaar.
The new government is expected to take refuge in the Supreme Court order,
which directs that Aadhaar should not be mandatory for availing
31. SUCCESS STORY
Perhaps the most powerful example of the potential of Aadhaar and DBT comes from
Adilabad and East Godavari districts of Andhra Pradesh, where more than 95% of the
population is enrolled in Aadhaar
DBT has resulted in reduced leakages of about Rs.45 crores in Adilabad
East Godavari of about Rs.120 crores in less than a year.
In both these districts, Aadhaar also enabled identification of duplicate and
fake Liquified .Petroleum Gas (LPG) connections, which were terminated,
over 25,000 new rightful connections for women enabled.
it also revealed bogus pensions amounting to Rs.10-15 crore
50,000 bogus job cards under the MNREGA scheme.
32. Will everyone receive their Aadhaar number in time?: In three years, the
government has issued about 400 million Aadhaars, which leaves 800
Issued a bank account in time: According to the deputy governor of RBI,
only 40% of Indians have bank accounts.
Talking about villages in particular, about 188,000 villages had banking
connectivity in June 2012 whereas India has 700,000 villages.
Will banking channel be ready in time: Currently, the banking
correspondents cover only 70,000 villages which require a further 10-fold
At present, BC companies are very few and even if the target is achieved it
will take time to find people and train them.
WHAT ARE THE CHALLENGES?
33. DBT in ultimate analysis aims at poverty
elimination, inclusive growth and delivering
better welfare measures.
problems with banks, post offices and online
connectivity should be resolved.
No doubt rampant corruption, inefficiencies
and leakages have made many welfare
Direct Benefit cash Transfer to the poor
aims to mitigate these many malaises.
Considering these benefits, India would be in
right direction to implement cash.
34. The new system is expected to reduce this cost and subsidy bill
through better targeting.
If the entire system is managed through efficient targeting,
disbursement and regular monitoring of the disbursed funds this can
result into transforming the rural India.
The real success of the policy lies in the accuracy and efficiency in
identification of worthy beneficiaries, i.e. BPL Households.