ESSAY
The Direct Benefits Transfer (DBT) scheme is significant since it has taken up the challenge of defining a new social security structure which is bold in its vision, sincere in its intentions and has strong transformative potential
The Government of India has announced the Direct Benefits Transfer initiative with the aim of ensuring better and more timely delivery of benefits to the people.This marks a paradigm shift,where the State is explicitly taking responsibility to ensure that welfare schemes and basic entitlements reach the intended beneficiaries much more effectively than at present.
Similar schemes in various forms have been implemented in a number of countries in the world. We have had programmes like Bolsa Familia in Brazil, Oportunidades in Mexico, Samrudhi Kosh in Sri Lanka.
What will DBT do?
The DBT programme aims that entitlements and benefits to people can be transferred directly to them through biometric-based Aadhaar linked bank accounts, thus reducing several layers of intermediaries and delays in the system. The last mile of the initiative is the most important — the system will allow actual disbursements to take place at the doorstep of the beneficiaries through a dense, interoperable network of business correspondents (BCs) using biometric micro ATM machines
Why is DBT a paradigm shift?
There are several dimensions to this. First, the link to Aadhaar and the use of biometrics ensures that the problems of “duplicates,” i.e., the same person getting the benefit more than once, and “ghosts,” i.e., a non-existent person getting the benefit, are addressed.
Second, it makes it possible for money to reach the intended beneficiaries directly and on time — so, for example, pensions, which reach the beneficiary once every four to six months in many parts of India, can now reach her bank account on the first of every month.
Third, a dense BC network on the ground with micro ATMs will allow payments to happen at peoples’ doorsteps,...