Business correspondence model for speedy payments for MGNREGA workers

Business correspondence model for speedy payments for MGNREGA workers

New Delhi: For speedy disbursal of payments to workers under the flagship Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the ministry of rural development has decided to introduce the business correspondence model, to be followed by banks.

State governments have been asked to roll out the model in which payments would be made through bio-metric authentication at the village level. In order to do so, the banks can follow the business correspondence model.

The ministry has decided that the fee to be paid to banks or business correspondents should be a fixed charge per account or a percentage of the transaction but should not exceed 80 per account a year.

“In case the amount exceeds the limit of 80 per annum per active account, it would be met by the state government from its own budget," the letter to the states from the ministry says.

Mint had reported on 20 July that the ministry was planning to pay 80 every year to state-owned banks for each account they have for a beneficiary of the rural job guarantee scheme.These charges have to be incurred from the 6% administrative expenses admissible under MGNREGA.

MGNREGA is the marquee job guarantee scheme of the Congress-led United Progressive Alliance (UPA) government and promises 100 days of work a year to every rural household.