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Accurate Targeting of Beneficiaries, Curbing Pilferage & Duplication under DBT Benefitted Government

DBT or Direct Benefit Transfer Mechanism started under UPA on 1 January, 2013 on pilot basis and subsequently effectively implemented under present NDA regime of Prime Minister Narendra Modi, took off in a major way after the commencement of LPG Subsidy Scheme through this and has saved nearly one year of total subsidy payout by the government in the last three years up to December, 2016.

Direct Benefit Transfer is an attempt to change the mechanism of transferring subsidies directly to the people through their bank accounts linked to Aadhaar. It’s a seamless electronic Aadhaar based cash transfer system for transfer of cash benefits to beneficiaries. 26 PSU Banks, 12 RRBs and some Private Banks and Cooperative Banks equipped with Core Banking System are on board for roll out of DBT.

Major objectives of Direct Benefits Transfer Programme are:

  • Switch to Aadhaar seeded bank accounts of the beneficiaries
  • Accurate Targeting
  • De-duplication or the elimination of ghost beneficiaries
  • Reduction of Fraud
  • Process Re-engineering of Schemes for simpler flow of information and funds
  • Greater Accountability

The government has, reportedly, cumulative saved around ` 50000 during the current Financial Year up to 31 December, 2016 as against total subsidy payout of around ` 49000 crore transferred through DBT during the same period. The total DBT payout since 2014 till date has been ` 160000 crore, which implies that nearly one year of total subsidy payout has been saved by the government through DBT in less than three years.

Presently around 33 crore people receive various subsidies directly in their bank accounts through DBT under 84 schemes of the central government. The government plans to bring a total of 533 central payout schemes under the DBT mechanism by March 31, 2018 which would significantly raise the savings figure of the subsidy. All this is in contrast to the losses of several lakh crore rupees by payment to ghost beneficiaries prior to the start of DBT.

According to the government, it has saved almost ` 14,000 crore in its Public Distribution Scheme by deleting 2.33 crore fake ration cards so far and better targeting of beneficiaries through DBT. ` 7,633 crore has reportedly been saved under MGNREGS scheme and ` 399 crore has similarly been saved under National Social Assistance Programme. The biggest saving of ` 26,408 crore is under LPG PAHAL scheme, including ` 4,824 crore in the first nine months of this financial year. All this has been possible due to linking with Aadhaar.

The best part of the DBS is that the subsidy benefit is reaching the deserved beneficiaries through their bank accounts linked to Aadhaar

Subsidy Saved


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