Chandigarh: The government on Friday launched the Central Bank Digital Currency (CBDC)-based Direct Benefit Transfer (DBT) under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) in the Union Territories of Chandigarh and Dadra & Nagar Haveli.
Under the CBDC-based DBT model, eligible PMGKAY beneficiaries will receive food subsidies directly into their CBDC wallets rather than via conventional bank account transfers. The subsidy can then be used to purchase foodgrains from empanelled merchants through a secure, traceable and real-time digital payment mechanism.
Chandigarh and Dadra & Nagar Haveli become the first Union Territories in the country to operationalise food subsidy transfers to eligible PMGKAY beneficiaries as programmable Central Bank Digital Currency (CBDC–Digital Rupee) tokens, directly into their CBDC wallets.
Among the dignitaries present at the launch event here included Punjab Governor and UT Chandigarh Administrator Gulab Chand Kataria, Union Minister for Consumer Affairs, Food and Public Distribution Pralhad Joshi, Union Minister for Agriculture and Farmers Welfare Shivraj Singh Chouhan and Union Minister of State for Consumer Affairs, Food and Public Distribution Nimuben Jayantibhai Bambhaniya, among others.
Speaking on the occasion, Joshi said digitalisation is helping deliver benefits to the eligible beneficiaries in a transparent manner while also helping detect the ineligible ones.
Joshi said when Prime Minister Narendra Modi talked about digital transactions several years ago, many in the opposition criticised.
He said they raised questions like what about internet connectivity, how can those who are illiterate do transactions and how can digitalisation become successful.
But today, if any country does the most digital transactions, that is India, Joshi said.
Under the CBDC-based DBT, Joshi assured that there is no question of excluding any eligible beneficiary. If I can say, this system is “rightful targeting”, while wrongful beneficiaries will be automatically deleted, he said.
Speaking on the occasion, Shivraj Singh Chouhan said today our granaries are overflowing. Under Prime Minister Narendra Modi’s leadership, the government is leaving no stone unturned in ensuring that benefits reach the eligible beneficiaries, he said.
Chandigarh was among the pioneers in implementing the DBT model for food subsidy in September 2015, moving from physical distribution of subsidised foodgrains to direct transfer of subsidy into the Aadhaar-linked bank accounts of entitled households, officials said.
The CBDC initiative builds on this existing DBT framework and seeks to make welfare delivery more transparent, traceable, efficient and purpose-bound, they said.
Building on earlier pilot implementations in Puducherry and Gujarat, the rollout marks complete digital adoption and saturation of all eligible beneficiaries across the targeted Union Territories.
The launch of CBDC-based DBT under PMGKAY marks a significant milestone in India’s journey towards building a modern, transparent and technology-driven welfare delivery ecosystem.
The CBDC-enabled DBT model seeks to ensure transparent and end-to-end traceable delivery of public funds, while reducing leakages, diversion and cash handling associated with traditional subsidy delivery mechanisms. It will also facilitate instant and secure transfer of benefits to beneficiaries and promote financial inclusion through simple wallet-based transactions.
The initiative will further strengthen accountability and real-time monitoring of subsidy utilisation and demonstrate the potential of the Digital Rupee for future payment systems.
An official statement issued here on Friday had said the digital rupee, or e-rupee, is a tokenised digital version of the Indian rupee, issued by the Reserve Bank of India (RBI) as a Central Bank Digital Currency (CBDC).
The introduction of CBDC – Digital Rupee offers an opportunity to enhance the DBT ecosystem by providing a secure, instant, traceable, and programmable digital cash mechanism for PMGKAY beneficiaries.
Under the new model, the digital rupee can be programmed for a defined purpose and within specified conditions. In the case of food subsidy, the digital benefit will be purpose-bound for the purchase of entitled foodgrains such as wheat and rice from authorised/empanelled merchants, it said.
Beneficiaries will receive the digital food subsidy, visit an empanelled merchant, scan the QR code and complete the transaction for the purchase of entitled foodgrains.
