In old days when people were struggling for their basic necessities Roti kapda aur makan. Then Indian government started to provide subsidy on bills i.e. some part of bills were paid by the government and people had to pay reduced amount of their bills. Later the government used to reimburse the subsidy amount to that company which provided the product. Even there was a big problem with public distribution system and the government couldn’t target the actual beneficiaries. It was seen a middleman can help anyone to take the benefit of subsidy still if he is not eligible for it. Even government was giving subsidy to those who did not exist in this world. Then government started opening of Jan Dhan account which give a chance to government to verify the recipients and transfer the benefits direct into their accounts. Let me take an example that when farmer is eligible for subsidy and buys fertilizer, he has to pay full cost to the retailer and subsidy amount was directly transferred to their bank account. Thus it was called as Direct Bank Transfer. But there was still problem that some people do not have bank account and country was also lacking in banking infrastructure in rural areas. So there was need to find out more alternatives. One alternative was to use voucher based system.
Let’s imagine some parents in remote areas looking for their child’s education and they have the only alternative to get them admitted in a government school and government also wants none of the students should leave without education but administrators of such schools are accountable to government only not to parents. Hence they do not bother much about the access of state funding for child’s education. If truth be told, the absenteeism of teachers in many schools across the country is also a major issue that affects the child’s quality education. To handle this situation is to make them accountable for the parents. A voucher based system is very much suitable for it.
Suppose government has given voucher to support your kid’s education, schools needs to collect these vouchers and need to redeem and money will be transferred to kid’s accounts and if parents things they will not get quality education then they will send their kids to those schools which are performing well. Accordingly government fund will be received by those schools that are performing well and non performing institutions will experience the consequences. In this way it is very much similar to Direct Benefit Transfer but it uses a physical voucher. But it does not completely solve the problem therefore e-RUPI comes in to existence launched on 2nd August 2021 by the Prime Minister of INDIA.
e-RUPI is cashless and contactless way for paying digitally. It works as an e-voucher that is based on QR code/SMS string which it to be delivered on beneficiaries through aadhar linked mobile number. Beneficiary may receive SMS from government and they all have to redeem e-voucher and can use for child’s education. Kid’s education is just taken as an example there are other area like mid day meal distribution, fertilizer, LPG, Ayushman Bharat, Pradhan Mantri Jan Arogya Yojana subsidies etc. where such system can be used and may be very effective. We hope this initiative has long way to go and can prevent leakage in the public distribution system.
