Direct cash transfer: Taking stock of how it fares

The partial rollout of direct cash transfer has both merits and demerits, an article in the Hindu Business Line has said.

One of the merits, according to the article, is that it has promoted savings habit among poor villagers. Other advantages listed out by the villagers included “the flexibility to withdraw the amount needed; the speed of withdrawal and the comfort of doing so at the time of convenience; and the absence of illegal service charges.

According to K Annamalai of Seliamedu near Pondicherry, quoted in the report, every time he went to get his pension from the anganwadi earlier, they deducted Rs 50 from his pension claiming to be their service charges.

Paucity of bank accounts and beneficiary are putting a drag on the efficient rollout of the scheme.

Apart from this, the other major problem is the wide variance in the Aadhaar enrolment. While there are places like Kakinada in Andhra Pradesh where the enrolment is almost 100 percent, there is also Nandurbar in Maharashtra, where the case is almost he opposite. It is ironical that Nandurbar was the first district in the country to start Aadhaar enrolment.

The controversy over the cash transfer scheme’s implementation, efficacy, desirability and constitutionality is unlikely to settle easily. But the government is hell bend to go ahead with the national rollout of the scheme, the article said.

“The political dividends of doing so, of course, are much less important than the real dividends,” the article said.

The report is available in the print edition.