Last year, under the Direct Benefits Transfer (DBT) programme, the government disbursed Rs. 61, 824.32 crore to 30.78 crore accounts in 59 schemes of 14 Ministries/Departments. As the government pushes ahead with DBT in more schemes, especially food, fertilizer and kerosene, it is imperative that the key enablers are in place before the scheme takes off in any district or state. A recent CGAP blog post by Silvia Baur, When Mandating Financial Access for the Poorest Fails, reiterates the five common risks that recipients of digital social payment programs experience: network or service unreliability, insufficient liquidity, complex user interfaces and payment processes, poor recourse mechanisms, and fraud. As these risks can adversely affect trust of the first-time user of formal financial services, a successful transition “ requires careful work by all players in the value chain. The end-to-end solution must be convenient and safe for the recipients, but also take into account the business incentives for payment service providers”.
Leena Datwani and Anand Raman of CGAP put together a concise round-up of the strengths and challenges in each of the eight Payments Banks licensees, How India’s New Payments Banks Stack Up. Their conclusion – “While there are challenges, there is sufficient reason to believe that the remaining players are fully capable of finding innovative means to surmount them”.