If 100 rupees of grain is sent via the PDS distribution channel and only 60 rupees goes to the beneficiary, economists talk about 40% leakage and corruption.
Now if AEPS fails 40% of the time, what is the corruption and leakage? This is world beating technology?
Now if AEPS fails 40% of the time, what is the corruption and leakage? This is world beating technology?
For all practical purposes, transfer costs of moving money from one bank account to another is Zero. NEFT and RTGS are dated systems, but they work reliably.
But AEPS is not NEFT, RTGS. It adds 3 more layers.
The Aadhaar Mapper and 2 Seeding Layers.
But AEPS is not NEFT, RTGS. It adds 3 more layers.
The Aadhaar Mapper and 2 Seeding Layers.
Seeding Layer 1 is adding your UID to the benefit scheme.
Seeding Layer 2 is adding your UID to your bank account.
And then Transfer is not to the destination bank account directly but by an intermediate switch called the Aadhaar Mapper.
We have not yet come to distribution.
Seeding Layer 2 is adding your UID to your bank account.
And then Transfer is not to the destination bank account directly but by an intermediate switch called the Aadhaar Mapper.
We have not yet come to distribution.
Distribution involves more layers.
1. The Banking correspondent
2. The Micro ATM.
3. Beneficiary's Fingerprint.
4. Random bank rules for withdrawal limits.
Only when all this works, you move the money from bank account to the hands of the beneficiary.
1. The Banking correspondent
2. The Micro ATM.
3. Beneficiary's Fingerprint.
4. Random bank rules for withdrawal limits.
Only when all this works, you move the money from bank account to the hands of the beneficiary.
In the ration shop, the word "cutting" and "setting" is commonly used, even in 1990s. It means someone else "cuts" your portion or it does not get to you on time.
Layered failures as shown above is also a form of "cutting" but caused by human and tech failures.
Layered failures as shown above is also a form of "cutting" but caused by human and tech failures.
You can think of "cutting" as what the beneficiary receives swallowed up by time because of human and tech failures. So looked at this way, AEPS cutting is no different than PDS cutting.
End result: People don't get what they want on time and when they want it.
End result: People don't get what they want on time and when they want it.
Economists in general, fail to appreciate that Distribution is a F(Infrastructure). What you choose as an Infrastructure determines success and failure.
it is not about cash transfer or PDS. It is about the infra, tech used and accountability measures.
it is not about cash transfer or PDS. It is about the infra, tech used and accountability measures.
Pick the right infra, tech used and add in a lot of accountability measures, PDS can be improved. We have seen that on states where things improved.
Same applies for cash transfer. Is AEPS the right infra? Is BC driven Micro ATM the right model?
Lots to think about.
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Same applies for cash transfer. Is AEPS the right infra? Is BC driven Micro ATM the right model?
Lots to think about.
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