2025, Vol. 7, Issue 12, Part C

India’s Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is the largest wage employment programme in the world with about 25 crore registered workers and nearly 10 crore active workers. It is the only scheme which came into effect by an act of parliament in the history of India’s rural development or poverty alleviation programmes. Its objective is to provide livelihood security to rural households by providing at least 100 days of wage employment in a financial year. MGNREGS guidelines 2006 provided for the payment of wages to workers within (15) days of closure of muster. Government of India has been implementing digital payment system known as Direct Benefit Transfer (DBT) from 2013 in the payment of Wages to NREGS workers. It is ensuring transparency and accountability in the system.

This digital payment system is largely successful with about 70,000 crores payment to nearly 9.5 crores active workers in 2023-24 financial year. Thus DBT/ Digital payment system is ensuring timely payment of wages to workers without any inordinate delays and avoiding multiple levels. This system has also eliminated middle men, brokers corrupt practices from the system. It also eliminated ineligible and duplicate beneficiaries from receiving Govt. benefits. Government has saved about 42530 crores of NREGS funds by implementing digital payment system upto March, 2023.

Besides these opportunities, there exists several challenges and bottlenecks in the implementation of DBT in MGNREGS. Large number of workers from disadvantaged and vulnerable sections of the society lack financial literacy financial inclusion and even digital financial inclusion. Many workers are still without Bank or Post office Accounts and Aadhaar number. Hence this article focuses on contemporary challenges in the digital payment/ DBT system in the implementation of MGNREGS. It also provides for systems and approaches to convert these challenges into opportunities so that NREGS scheme leads to inclusive and sustainable development in the country.