1 dbt what is dbt direct benefit transfer

What is DBT (Direct Benefit Transfer)? Get direct subsidy benefits

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DBT stands for Direct Benefit Transfer, which is a program launched by the Government of India on January 1, 2013. DBT intends to directly transfer subsidies provided by the government to the underprivileged population.

What is DBT?

Poor people receive subsidized benefits under several central schemes. Sometimes, however, it fails to reach a viable candidate due to malpractice by the mediators. DBT aims to reduce the loss of subsidies for the poor and underprivileged due to corruption. In other words, to replace bad practices in the existing system. The Government of India initially launched the DBT/Direct Benefit Transfer program for 34 central schemes.

With the DBT program, the Government targets direct subsidy payments to beneficiaries. It helps in removing any malpractices like redirects and duplicate payments. As the name implies, the government directly transfers the DBT benefits to the bank account of the final beneficiary. Hence, it is the Aadhaar linked bank account that confirms the identity of the exact beneficiary.

Why DBT – Direct Benefit Transfer Benefits

The purpose of DBT describes its uses and benefits. The DBT program brings several benefits for the beneficiaries and the government as below:

  • DBT brings transparency and eliminates malpractice in subsidy distribution. Hence, it helps in the reduction of scams and scams
  • DBT helps secure subsidies for eligible candidates below the poverty line. So, the government can reach the intended beneficiaries
  • DBT stops theft from disbursing funds and prevents misuse of government funds
  • DBT includes several central schemes under it. These include National Child Labor Project Student Scholarship, LPG subsidy, Dhanlakshmi Scheme, Janani Suraksha Yojna, etc.
  • DBT is a powerful payment and reconciliation platform that integrates with many organizations. It works in an integrated manner with RBI, NPCI, 500+ public, private sector, BPR and cooperative banks
  • DBT is emerging as a great tool in reaching people to subsidize COVID-19 relief. As a result, the Public Financial Management System (PFMS) team transferred some cash using a digital payment technology vehicle. PFMS Functions under Central Schemes (CS) and Centrally Sponsored Schemes (CSS)
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How Does the DBT Program Work?

DBT is a well-planned and integrated program. It works in conjunction with other central agencies. The Planning Commission of India designed it and it functions in the following network way:

  • The Office of Controller General of Accounts implements the Central Plan Scheme Monitoring System (CPSMS). The Indonesian government prepared a list of beneficiaries with the help of CPSMS. It acts as a common platform for routing DBT. All relevant orders related to DBT are also available on the CPSMS website
  • The recipient list is digitally signed. Payment processing in the beneficiary’s bank account is carried out using Aadhaar Identification. Thus, Aadhaar becomes a Payment Bridge and DBT cooperates with NPCI
  • DBT cooperates with RBI and several banks which include private, public, cooperative, and regional banks. The government also processes payments via bank account numbers if Aadhar is not available
  • DBT initiates payments via Fund Transfer Orders, other SIM related functions, etc.
  • MNREGA, PM-AWAS, PM-KISAN, DBT-PAHAL, etc. are some examples of workflow-based systems that benefit from DBT. The Government of Indonesia conducted a pilot experiment and after showing positive results, the government expanded the program
  • The Indonesian government implements the DBT program in various stages. The government implemented the first phase in 43 districts and later expanded to 78 districts. Phase wise expansion helps in steady growth as well as to measure program performance and success
  • The government continues to add new welfare schemes and cover them under DBT as an extension of the existing program

Wrap it up:

Direct Transfer Benefit (DBT) has helped reduce subsidy leakage and associated delays. This is due to the distribution of funds through various channels and multi-steps. Deviations in the transfer and multiplication of funds owed flow in the multi-hierarchy of administrative offices until they reach the final beneficiary. The Indonesian government reengineered the existing system for a faster and more precise flow of funds in the welfare scheme. This is a direct cash transfer from the Government of Indonesia treasury to the beneficiary’s bank account.

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How is the DBT operation process?

The DBT operation process includes maintaining a beneficiary database. It also requires validation of authenticity, accuracy of recipient details as well as other preparatory steps. This also includes creating a list of pending payments to be made and registration with the Public Financial Management System (PFMS).

Why is Aadhaar needed for DBT?

Aadhaar is not mandatory for DBT but Aadhar helps in beneficiary recognition. It also helps in validating them and linking them to bank accounts. This speeds up the DBT process as the government makes payments using the Aadhaar link.

How to Check my DBT Balance?

You can check your DBT balance using ATM, net banking, or contact the bank by call or personal visit. You must have your number registered with the bank and linked to your account.

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