India’s welfare system has undergone a profound transformation in recent years as technology has been channeled to manage long-standing challenges such as bureaucratic inefficiencies, administrative leakages, and corruption. For decades, social assistance programs—whether in the form of cash or in-kind transfers—suffered from complex processes and significant fund losses, with studies revealing that out of every 1 rupee allocated, only about 15 paisa reached the intended beneficiary. This inefficiency was particularly striking given that India dedicates nearly 3%-4% of its GDP to subsidies (Economic Survey, 2017-18) and social support programs aimed at uplifting its citizens. However, systemic challenges in effectively identifying the true beneficiaries, coupled with delays in delivery, result in a significant loss of resources—equivalent to nearly half (Policy Paper, National Institute of Public Finance and Policy) of these allocated funds each year. In response, the government introduced the Direct Benefit Transfer (DBT) system in 2013, a transformative initiative aimed at delivering benefits directly to citizens’ bank accounts while minimizing human intervention (Table 1: An estimated gain of about ₹3,48,564.66 crore as per the data available on https://dbtbharat.gov.in/ ; as accessed on 08-02-2025). The DBT framework is built on the robust ‘JAM’ trinity of Jan Dhan Yojana, Aadhaar, and […]
The digital transformation and efficiency of India’s direct benefit transfer model
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