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This is an archive article published on April 9, 2012

NREGS: Meghalaya to pay via smart cards

In a first in the entire northeastern region,the NREGS workers in Meghalaya are going to get their pay through biometric smart cards.

In a first in the entire northeastern region,the NREGS workers in Meghalaya are going to get their pay through biometric smart cards. The scheme,involving Axis Bank,has been launched on a pilot basis on March 22 under the aegis of the Reserve Bank of India.

RBI officials said that while they would have liked to have rolled the pilot out in all the northeastern states,under policy guidelines,2 per cent of the payment is to be borne by the state government,and no government in the Northeast apart from Meghalaya has been willing to do so thus far.

“Under the financial inclusion goal of the RBI,NREGA payments have to be made mandatory through bank accounts and not as cash payments. This is to ensure transparency and promote technology-based banking. Most areas in the Northeast are un-banked. So,we are disbursing NREGA payment through individuals representing banks who visit remote villages. The advantage of the smart card is that all personal details of the beneficiary is fed into it and there can thus be no duplication or misutilisation of funds,’’ says an RBI official,admitting that in the past the NREGA scheme had come under criticism for not reaching its beneficiaries.

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The Axis Bank has picked up Saipung block in the Jaintia hills region,a far flung area where disbursement of the funds has so far been ineffective. On March 22,the first-ever disbursement of payment took place at Narwah village of the block. There are seven districts in Meghalaya and once the next few rounds of payment takes place,the government will extend it to the rest of the state.

Northeast regional head for Axis Bank Asif Mazid says that bank representatives visiting the village carry biometric machines,which are like credit card machines. “There is very little chance of misuse of funds. This is likely to be far more effective in the Northeast than just having bank accounts since large tracts of this region,especially in Meghalaya,Mizoram and Nagaland,have unbanked blocks,” he says.

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