After success of payment of National Rural Employment Guarantee Scheme’s (NREGS) wage through banks and post offices, the Centre intends to introduce telephone banking facility for those living in the remote and far flung areas of the country.
According to the ministry of rural development, the nodal ministry in charge of NREGS implementation, through the introduction of telephone banking facility, the government intends to address issue of irregular wage payment to beneficiaries in far off areas.
The ministry has asked the department of financial services (DFS), under the ministry of finance, to facilitate the process of disbursement of wages to NREGS workers through bank accounts and promote branchless banking through mobile phones in far off rural areas.
Following request from rural development ministry, the DFS has already asked the Reserve Bank of India to facilitate an effective process of disbursement of wages to NREGS wage earners.
In this regard the banks will be asked to support initiatives like Smart Cards and other technological interventions for facilitating easy and effective disbursement of wages to the right beneficiaries.
RBI is examining the concept of the banks utilising mobile van banking with use of biometric technology for easy disbursement to beneficiaries, wherever required. Rural development officials said that the RBI will monitor opening of NREGS accounts by banks quarterly meetings.
According to ministry of rural development data, during 2007-08, Rs 10,738 crore was disbursed as wages under NREGS to more than 3.3 crore households out of a total expenditure of Rs 15,856 crore under the scheme.
Earlier after reports of irregularities wage payment, the government had asked the state governments to launch a massive campaign for opening of saving accounts of the NREGS workers in banks or post offices.
Till date more than 1.9 crore savings accounts have been opened across rural belt with banks and post offices.
The ministry of rural development officials said despite spread of rural bank branches, more than 50% of rural households have been deprived of banking services for many years.
?This has resulted in inclusion of large number of people under poverty line with the formal banking system and added close to a crore savings bank account holders to existing 14 crore accounts holder with the post office,? a rural development ministry official said.
Under the memorandum of understanding (MoU) signed with department of post and rural development ministry, the payment of wages to the workers under NREGS must be done within the statutory time of 15 days after the work is done.
The ministry will pay an advance of Rs 50 per account prior to the opening of account. ?The accidental insurance cover to individual postal savings account holder provided by Oriental Insurance Company will be gradually extended to those accounts which are used for NREGS wage payment,? a ministry official said.
Every person under NREGS is entitled to wages at the minimum wage rate fixed by the state government. The payments are made on weekly basis on a pre-specified day of the week in gram panchayat.