Direct Benefit Transfer (DBT): Meaning, Schemes Covered, Benefits

In India, the underprivileged population receives subsidies from the central government through various schemes. Nevertheless, sometimes, these subsidies fail to reach the deserving people because of malpractices by the mediators. 

Hence, the government introduced the Direct Benefit Transfer (DBT) scheme to reduce the subsidy loss among the underprivileged population due to corruption. In this article, we will discuss everything about Direct Benefit Transfer in detail.  

What is Direct Benefit Transfer?

In DBT, benefits or subsidies are directly transferred to citizens living below the poverty line, ensuring subsidies are targeted to those in need. the government significantly transfers the cash benefits and subsidiaries to the Aadhaar-linked bank accounts of the beneficiaries. On 1st January 2013, the Government of India implemented the Direct Benefit Transfer scheme to transfer the subsidy amount directly to the beneficiaries’ accounts. 

The DBT scheme was first created by the Planning Commission to focus on the execution of the DBT program. Nevertheless, the Department of Execution took over the scheme from July 2013 to 14th September 2015. After that, the matters related to the DBT scheme were transferred to the Cabinet Secretariat under the Coordination & PG Secretary on 14th September 2015. 

Purpose and Objectives of DBT

After knowing what is direct benefit transfer, you must know the purpose and objectives of this scheme. The primary goal of this scheme is to provide simpler/faster flow of information and funds to the beneficiaries and to reduce the fraud in the delivery system. Subsidies directly to the Aadhaar-linked bank accounts of individuals eligible for this. It reduces the associated delays and diminishes corruption caused by the money flow through various administrative offices. 

Moreover, the scheme targets the beneficiary with precision without the inclusion of mediators who cause delays and duplication. It also benefits the beneficiaries by reducing the number of layers involved in the provision of benefit. 

How Does Direct Benefit Transfer Work?

The DBT scheme is a well-integrated and well-planned initiative by the government to help underprivileged people. To improve transparency, the government complies with the list of eligible people for this scheme through the Central Plan Scheme Monitoring System (CPSMS). After that, the Aadhaar card retrieves the required details, making transferring funds seamless to the beneficiaries.

Nevertheless, having an Aadhaar card is not mandatory for the beneficiary, as the government can use Jan Dhan accounts and mobile connections to execute DBT. With the help of this scheme, 43 crore beneficiaries received subsidiaries until now through 316 crore DBT. 

How Direct Benefit Transfer Saves Money?

Benefits of Direct Benefit Transfer

The following are some of the key advantages of direct benefit transfer:

1. The DBT scheme offers transparency and removes the subsidy distribution malpractices, expediting the safe distribution of assets. Hence, it reduces the scams and frauds caused by mediators.
2. Through this scheme, the subsidy amount gets directly transferred to the beneficiary account, eliminating the necessity of mediators.
3. This approach enabled unique linking of rural and urban households for government subsidies and easy money transfers.
4. It is an effective way to connect with the beneficiaries to distribute the aid funds.
5. Through this scheme, the government can speak with the citizens and program participants at once.
6. The government can precisely target the beneficiaries through this scheme.
7. It covers various central schemes such as LPG subsidy, National Child Labour Project Student Scholarships, Janani Suraksha Yojna, Dhanlakshmi Scheme, etc. 
8. Beneficiaries must join one bank account by linking their money contributions with their Aadhaar information, restricting subsidy duplication.
9. It allows the distribution of grants to eligible applicants struggling financially and facilitates communication between the eligible people and the government.
10. The DBT scheme reduces public resource exploitation and avoids payment distribution theft. 

Categories of Schemes Covered Under DBT

The DBT scheme covers the following categories of schemes:

1. Cash Transfer

The government right away transfers the cash benefits to each beneficiary under the DBT cash transfer scheme. Some examples of this scheme include MGNREGA, PAHAL, NSAP, etc.  Here is a list of various ways through which the government transfers money to the beneficiaries:

• Beneficiaries receive the amount directly. 
• They get money through the State Treasury Account.
• Via an Implementing Agency assigned by the government.
• Direct transfer from the State or Central Government.

2. In-kind Benefit Transfers from Government

Under this category, the government provides in-kind benefits of the programs or scheme components to the beneficiaries directly or appoints implementing entities. Usually, the government or its agent sustains internal expenditures to purchase products for distribution to the public and offer services to the beneficiaries. Moreover, the beneficiaries receive these products or services at a reduced cost or free. 

3. Other Transfer Types

Apart from these two categories of schemes, there is a different type of transfer from the government to several non-government officials. These non-government officials are the individuals who assist in several government programs' facilitation till the end. 

In addition, it covers payments given to several government programs’ facilitators, like community workers and non-governmental organisations, in the form of incentives, honoraria, etc., in return for effective programs’ execution. 

Key Government Schemes under the Direct Benefit Transfer 

There are 317 schemes that are covered under DBT. Some of the major schemes covered under DBT scheme have been listed below.

• Atal Pension Yojana
• Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (AB-PMJAY)
• Deendayal Antyodaya Yojana – National Rural Livelihoods Mission (DAY-NRLM)
• Deendayal Upadhyay Grameen Kaushalya Yojna
• Green India Mission National Afforestation Program
• Khelo India
• National Ayush Mission
• National Food Security Mission
• National Livestock Mission
• National Mission for Sustained Agriculture (NMSA)
• Pradhan Mantri Bhartiya Jan Aushadhi Pariyojana (PMBJP)
• Pradhan Mantri Fasal Bima Yojana
• Pradhan Mantri Krishi Sinchai Yojana
• Pradhan Mantri Matsya Sampada Yojana
• Pradhan Mantri Vaya Vandana Yojana
• Swachh Bharat Mission Gramin

Direct Benefit Transfer in Agriculture Mechanisation

The direct benefit transfer also plays a significant role in the agriculture industry in India. Here are some of the benefits of direct benefit transfer in agriculture mechanisation:

1. It improves transparency in distributing subsidies and minimises corruption opportunities. DBT also ensures minimising the funds misuse and offers a better tracking of the distribution process.
2. DBT schemes in the agriculture industry target the intended beneficiaries, ensuring they get the benefits of the various schemes directly. Hence it improves the fairness and equity in distributing subsidies.
3. It reduces the subsidy distribution cost significantly by removing intermediaries and increases the efficiency of input procurement.
4. Direct benefit transfer to farmers allows them to invest in modern farming techniques to promote technological adoption in agriculture. 

Final Word

Direct Benefit Transfer (DBT) schemes in India have revolutionized the delivery of government benefits, recognized globally as a logistical marvel. With 317 schemes across 53 ministries utilizing DBT, the system has led to significant savings, estimated at 1.14% of GDP. Beyond curbing corruption and increasing coverage, DBT preserves the dignity of beneficiaries by ensuring direct benefit transfers without intermediaries. This approach not only enhances transparency but also empowers individuals, particularly the poor, by eliminating the need for them to navigate bureaucratic hurdles to access essential services. By leveraging technology and the JAM Trinity (Jan Dhan, Aadhaar, and Mobile), DBT has not only streamlined benefit distribution but also fostered a more dignified and efficient welfare system in India.