Why in News?
The government has launched a Central Bank Digital Currency (CBDC)-based Direct Benefit Transfer (DBT) system under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) in Chandigarh and Dadra & Nagar Haveli. These have become the first Union Territories to implement food subsidy transfers as programmable Digital Rupee (e₹) tokens directly into beneficiaries' CBDC wallets.
About
- Under the new system, eligible PMGKAY beneficiaries will receive food subsidies directly in CBDC wallets instead of conventional bank accounts.
- The subsidy can be used to purchase foodgrains and other essential food items from empanelled merchants.
- Technological safeguards ensure that the funds are used only for permitted food purchases, preventing diversion of the subsidy.
- Beneficiaries can choose from wheat, rice, pulses and other essential food commodities.
- The system provides secure, real-time and traceable subsidy transactions.
- The initiative aims to improve transparency, accountability, efficiency and targeted delivery of welfare benefits.
CBDC – Digital Rupee
- CBDC is a digital form of currency issued by the Reserve Bank of India (RBI).
- India's CBDC is known as the Digital Rupee (e₹).
- It is a tokenised digital version of the Indian rupee.
- CBDC can enable instant, secure, traceable and programmable payments.
