26 dists identified for Aadhaar-enabled payment of MGNREGS wages

The Union government has set March 15 as the deadline for the governments of Karnataka and 13 other states to ensure that the Aadhaar numbers of at least 50 per cent of beneficiaries of the rural job scheme are linked to the databases of the workers for payment of wages.

The Ministry of Rural Development (MoRD) has identified 252 districts, including 26 in Karnataka, for switchover to Aadhaar-enabled payment system (AEPS) to pay wages to the beneficiaries of the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS).

The MoRD chose only the districts which already achieved more than 50 percent Aadhaar enrolment and has significant population of MGNREGS beneficiaries. The AEPS will require Aadhaar enrolment of the beneficiaries, seeding of Aadhaar numbers in NREGASoft, verification of the seeded Aadhaar numbers with the database of the Unique Identification Authority of India, seeding of Aadhaar numbers in the bank accounts and their mapping on the National Payment Corporation of India and identifying business correspondents in all the gram panchayats to disburse wages in cash after Aadhaar authentication using micro-ATMs.

The government has since long been trying to shift to electronic mode for distribution of wages to MGNREGS beneficiaries, primarily to avoid delays, to ensure transparency and to eliminate the role of the middlemen. 

The electronic fund management system (eFMS) has already been implemented in Karnataka, Andhra Pradesh, Gujarat, Odisha, Madhya Pradesh and Maharashtra.

The MoRD officials however pointed out that the eFMS only took the wages to the bank accounts of the beneficiaries, while the payment had to traverse the last mile to reach the beneficiaries, who found it practically impossible to come all the way to the banks from far-flung villages to withdraw money.

“This is essential since we have one bank branch serving 5,000-10,000 wage seekers; and it is practically impossible to withdraw money by personally going to the bank branch. The only alternative is to use the postal system or business correspondents’ system of the banks,” the MoRD stated in a recent note to all the 14 states. To make payments through business correspondents more reliable, effective and immune to fraud or misappropriation, the MoRD is keen to use biometric authentication through the Aadhaar and thus shift to AEPS.

The MoRD asked the state governments to pay Rs five to each Gram Rozgar Sevak, a full-time functionary for implementing the MGNREGS, for verification of Aadhaar number of each beneficiary.

The Mahatma Gandhi Rural Employment Guarantee Act, 2005, legally guarantees at least 100 days of wage employment in a financial year to every rural household, which has adult members willing to do unskilled manual work. 

The programme provided jobs to 4.8 crore rural households in 2012-13, generating 213 crore person-days of employment at a total expenditure of over Rs 39,000 crore.