Direct Benefit Transfer Scheme

Direct Benefit Transfer Scheme

Why in News?

  • Recently, Most economists advocate the conversion of all agricultural subsidies into direct income support i.e., Direct Benefit Transfer to farmers

Highlights

  • It has been visioned as an aid for simpler/faster flow of information and funds to the beneficiaries and to reduce the fraud in the delivery system.
  • It is a mission or an initiative by the government of India started on 1st January 2013 as a way to reform the government delivery system.
  • Central Plan Scheme Monitoring System (CPSMS), the earlier version of the Public Financial Management System (PFMS), of the Office of Controller General of Accounts, was chosen to act as the common platform for routing of the Direct Benefit Transfer.
  • Primary components in the implementation of DBT schemes include Beneficiary Account Validation System, a robust payment and reconciliation platform integrated with Reserve Bank of India (RBI), National Payments Corporation of India (NPCI), Public & Private Sector Banks, Regional Rural Banks and Cooperative Banks (core banking solutions of banks, settlement systems of RBI, Aadhaar Payment Bridge of NPCI) etc.
  • In a mission-mode approach, it endeavoured to open bank accounts for all households, expanded Aadhaar to all and scaled up the coverage of banking and telecom services
  • It created the Aadhaar Payment Bridge to enable instant money transfers from the government to people’s bank accounts.
  • This approach not only allowed all rural and urban households to be uniquely linked under varied government schemes for receiving subsidies directly into their bank accounts but also transferred money with ease.
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