Direct Benefit Transfer (DBT)

Syllabus- Economy [GS Paper-3]

04/03/2025

250 2 minutes read

Context

Finance Minister Nirmala Sitharaman introduced that 1,100 out of 1,200 authorities schemes at the moment are under Direct Benefit Transfer (DBT), ensuring direct transfers to beneficiaries’ bank debts.

Need and Background of Direct Benefit Transfers

After independence, India sought to triumph over the constraints inherited from colonial rule and become a global power, emphasizing centralized planning and public welfare.
Despite the emphasis on public provisioning, there have been several issues in gaining access to welfare benefits because of financial leakages, delays, and inefficiencies.

Direct Benefit Transfer (DBT): Timeline

Direct Benefit Transfer offers the transfer of benefits to the marginalized and susceptible sections of society.
In 2014, under Prime Minister Modi’s leadership, the Direct Benefit Transfer (DBT) project was launched, leveraging digital technologies to enhance public carrier delivery.
In 2014, Pradhan Mantri Jan Dhan Yojna (PMJDY) was launched to address financial inclusion.
JAM Trinity : The achievement of PMJDY paved the way for the advent of the sector’s largest focused payments framework.

Major Central schemes seeded with DBT

PM Kisan Samman Nidhi (PM-KISAN): It is a Central Sector Direct Benefit Transfer (DBT) Scheme, under which, financial assistance of Rs.6000/- in keeping with annum is supplied to all landholding farmer households throughout the country, condition to certain exclusion standards.
Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS): It aims to enhance livelihood safety for rural families.
- Its wages are credited directly to the financial institution/submit office debts of Mahatma Gandhi NREGS beneficiaries by using the Central Government via DBT.
Pradhan Mantri Matru Vandana Yojna (PMMVY): It aims to encourage improved health-in search of conduct among Pregnant Women and Lactating Mothers (PW&LM).
- It gives blessings to beneficiaries through Direct Benefit Transfer (DBT).
Pradhan Mantri Awaas Yojana- Gramin (PMAY-G): The PMAY-G aims at offering 2.95 crore homes to the eligible rural population within the country so that they can achieve the goal of “Housing for All”.

DBT’s Impact

DBT schemes extended from 28 in 2013-14 to 323 in 2024-25, with finances transferred developing almost 1000 times, from 7,400 crores to 7 lakh crores.
DBT has saved around 3.5 lakh crores through lowering leakages and inefficiencies.
DBT eliminated faux or replica beneficiaries, using Aadhar records, with schemes like PAHAL, MGNREGS, and PDS removing over 9.2 crore ineligible beneficiaries.
DBT ensured well timed transfer of benefits, improving the delivery of scholarships, pensions, and social assistance, while getting rid of delays and lowering dependency on government offices.
DBT Increased transparency and accountability and it allowed the redesign of welfare packages along with Swachh Bharat Mission (SBM), PM-JAY (health insurance), and PM-KISAN (farmers’ cash transfers).

International Recognition

DBT has been praised by global corporations just like the World Bank and IMF for its efficiency, lowering corruption, and broadening the attainment of welfare schemes.

Future Potential

The success of DBT can be leveraged to introduce more welfare schemes, and its efficiency can guide revolutionary guidelines addressing broader well-being, assisting India pass in the direction of turning into an evolved state by 2047.

Source: The Indian Express