The government is increasingly emphasizing the use of Aadhaar-linked Direct Benefit Transfer (DBT) for central schemes to enhance efficiency and transparency. This move aims to streamline the delivery of benefits, reduce leakages, and ensure that subsidies reach the intended beneficiaries directly.
The Direct Benefit Transfer (DBT) scheme was launched in 2013 with the goal of transferring benefits and subsidies directly to the beneficiary's bank account, cutting out middlemen and reducing leakages. JAM (Jan Dhan accounts, Aadhaar, and Mobile) are DBT enablers. The use of Aadhaar provides a unique identity and is useful in targeting the intended beneficiaries.
Under Section 7 of the Aadhaar Act 2016, the central and state governments can mandate Aadhaar for availing benefits and subsidies under schemes funded out of the Consolidated Fund of India or the State. This helps identify intended beneficiaries and remove fake or duplicate entries from scheme databases.
Aadhaar-linked DBT ensures that cash benefits are directly transferred to the beneficiaries' bank accounts, eliminating the need for additional documents and preventing issues like fake beneficiaries. Nirmala Sitharaman, the Union Finance Minister, stated that India has saved $40 billion in the last eight years through DBT schemes. More than 51 ministries and departments of the central government are using different DBT schemes, and over $450 billion has been transferred in the last eight years through this.
The PM-Kisan scheme, one of the world's largest DBT schemes, has already transferred more than Rs 3.04 lakh crore to over 11 crore farmers across the country. With the 18th installment, the total amount transferred has crossed Rs 3.24 lakh crore. This initiative uses a digital platform for transparent registration and transfer of welfare funds to farmers, eliminating the dependence on middlemen and promoting sustainable agricultural practices.
The government has been actively promoting financial inclusion through initiatives like Pradhan Mantri Jan Dhan Yojana (PMJDY). This Aadhaar-based approach has not only empowered people but also resulted in significant savings by removing crores of fake, non-existent, and ineligible beneficiaries from government schemes. For example, Aadhaar-based DBT has eliminated more than 4.15 crore fake LPG connections and 5.03 crore duplicate ration cards, ensuring the smooth distribution of essential services like cooking gas and food subsidies.
While Aadhaar is not mandatory in DBT schemes, it is preferred because it provides unique identification and helps in targeting the intended beneficiaries. In Karnataka, the state government centralized DBT payments, making payments only to bank accounts seeded with Aadhaar. The Core DBT Portal will be the only means through which DBT payments will be made by various departments.
Beneficiaries can receive DBT benefits in only one account of their choice, which they have specified while submitting the mandate and consent form to their bank for linking with Aadhaar. They can also avail facilities like cash withdrawal, cash deposit, balance inquiry, mini statement, and funds transfer through Bank Mitras/Bank Correspondents deployed by various banks and Post Offices. If beneficiaries have availed SMS alerts from their bank, they will receive SMS alerts when DBT funds are credited to their account.
