The system relies on a network of business correspondents to ensure that payments are made to the intended beneficiaries.
NEW DELHI: Congress president Sonia Gandhi's championing of the Aadhaar-linked direct benefits transfer scheme to eliminate the "deep-rooted malice" of graft from welfare programmes could well be in vain as several roadblocks dog the last-mile delivery in the new system.
The system relies on a network of business correspondents to ensure that payments are made to the intended beneficiaries. However, a viable incentive structure for new model of business correspondents and a proper system of appointing multiple business correspondents is yet to be worked out. There are no clearly defined parameters to assess the success of the direct benefits transfer system.
"Answers can only be provided as we go along. Reducing failures in identification to less than 5%, banks putting in place sufficient number of banking correspondents or customer service providers, and effectively monitoring delays in disbursements are among the parameters which will be used to determine the success of the Aadhaar-based system," Rural development minister Jairam Ramesh, one of the key proponents of Aadhaar-enabled direct benefit transfer, told ET.
"There are still formidable problems in large-scale implementation which are mostly to do with banks and post offices, with appointment of multiple business correspondents in an open, inter-operable, competitive framework and with the use of online micr-ATMs," Ramesh wrote earlier this month to Prime Minister Manmohan Singh.