Aadhaar-based payments through the fragile rural banking system adding to workers’ sufferings

images-2By Debmalya Nandy*

The payments of wages in MGNREGS (Mahatma Gandhi Rural Employment Guarantee Scheme) are done through   the Aadhaar Payments Bridge (APB) using the Direct Benefit Transfer (DBT) systems. The section 7 of the Aadhaar Act has been applied to MGNREGA which enables the central government and the state governments to establish the identity of an individual through  Aadhaar  for receiving subsidies, benefits or services from the government.

It is however not clear why a employment guarantee programme like MGNREGA is considered as a DBT scheme and why  does the NREGA workers are made to link their Aadhaar numbers with their respective job cards in order to receive payments against their work.

MGNREGA payments  is neither service nor a subsidy or a benefit, it is payment against work. So, literally the MGNREGA workers are getting their  remuneration against the  work that they carry out and which is assigned by the Gram Panchayats and other  Programme implementing agencies. The question is why would then the Section 7 of the Aadhaar Act would apply on MGNREGA, which is primarily a rural job scheme which provides  a maximum  100 days of employment guarantee to every  rural household.

The second important question is that while it has been shown through different studies and surveys that the mandatory Adhaar impositions have only added to the plight of the rural workers, why does the government transfer the MGNREGA wages through a direct benefit transfer system.

While it is important that the MGNREGA wages are credited to the  bank account provided by the workers which can be easily done through mapping of job cards and bank account numbers and channelizing the wages through the  system of  electronic transfer, the  need for  Aadhaar Number to be linked to the  job card is not clear, which then makes the whole process confusing and troublesome.

The wages then get credited to the bank account linked to the  Aadhaar number and this system  creates a  never ending puzzle for the workers. It is important to mention in this context  that in the direct benefit Transfer schemes, the subsidy or the benefits get credited to the beneficiary’s bank account which is last linked to her/his  Aadhaar number.

The issues:

1)      Often the Aadhaar number of the workers are linked to other people’s bank accounts  and  as a result the wages get credited to the wrong bank accounts. The  scale of this issue is quite serious  as we can  find such issues in almost each and every  Fund transfer Orders (FTO) sheets. These mistakes can be deliberate or inadvertent but the workers finally have to suffer. These misdirected transactions make life absolutely miserable for the workers who remain clueless about the cause of such issues  and get stranded not knowing  how to deal with such problems, as centralized payments and digital mode of implementation with a real time MIS linked execution in place, the accountability mechanisms have been completely thrashed.

2)      The rural  workers who have multiple bank accounts  have  problems of a different kind. Whenever a worker produces her/ his Adhaar card  for E-KYC or in the time of opening a new bank account, the consent for adhaar linking is given by default and without the knowledge of the worker and hence their bank linking status with their adhaar number  keeps switching between different banks and the payment of wages too keeps switching between banks.  This might sound funny but in reality there is great hardship that is added to the already hassled people.  The cost involved every time people visit banks can’t also be ignored and further adds to the exploitation.

3)      A large chunk of payments get rejected referring to a mysterious reason called inactive Adhaar. It is however not very clear from the official guidelines of the government, how these transactions get rejected due to In-active Aadhaar and most importantly how does the adhaar numbers get inactive.  There are many ways the government try to explain this however the issues seem to have increased  only in the recent years. The bottom line is that such an issue occurs in case of DBT payments and  creates more confusion among workers who are then made to submit their E-KYC’s again . These are unnecessary troubles and makes NREGA more non-credible for the workers who are already troubled by  various local issues and the system at large.

4)      A lot many payments have gone to Airtel Payments bank as the Aadhaar numbers of workers got linked to the said  payments bank. Similar issues were observed in the urban areas where the LPG subsidies were going to the Airtel Payments Bank. Despite repeated assurances from the government that this problem is dealt with and that, such errors will not be repeated, one can still find  payments  which are going to the Airtel Payments Bank.

5)      Aadhaar does not help in corruption control as the  means of corruption through forged muster rolls, workers working under someone else’s  job card continue to be the basic and biggest issues of MGNREGA which  can only be addressed only through  proper ground monitoring and a decentralized mechanism of grievance redress.A mere adhaar number does not help in fixing any of those issues.

While Aadhaar based payments have only added to the suffering of the labourers and it’s implementation through  the fragile rural banking systems have only created commotion, it is high time that the government should see the ground realities which are clear as daylight.

The most important debate however is how did the government apply the section 7 of the Aadhaar Act to the payments of MGNREGA remuneration  which in no way seem to be in accordance with the guideline of the Aadhaar Act. The government must clarify it’s intentions as over centralization, technology driven implementations and Aadhaar linked payments have created a great chaos in the implementation, increased leakages  and  demolished    local accountability in the grass roots. Can we imagine our salaries being linked to the DBT considering all the hassles that it brings with it?

*Social worker


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