Challenges in Pension Payment through Post Office Savings Account

As all of you know that the Direct Beneficiary Transfer (DBT) is going to implement on larger scale in all places.  The beneficiaries are going to receive their pension either through Aadhaar linked bank or Post Office Saving Account instead of receiving through eMOs.


This Public Finance Management System (PFMS) formerly known as CPSMS (Central Plan Scheme Monitoring System) is an initiative of Government of India to eliminating the existing intervening layers in fund disbursement.

As far as India Post is concerned it is a big challenge in different ways.  Proper planning and precaution should be made for the effective implementation of DBT through PFMS.  Otherwise large amount of public agitation will have to be faced by Post Office staffs.

Theoretically it very easy and every one can implement this without any issue.  But in reality it is not so easy.  Following points should be read for understanding why I have said that it is not so easy.

Challenges in Technology

India Post is using the same channel that they used in the EFMS in NREGA payment.  Present EFMS in Post offices is not an error free mechanism even if it handles only limited volume of accounts.  So many issues are still there to be solved in various Post Offices.

Complexity in process is the main reason for the issues in the present EFMS.  So many manual intervention and machine processing is needed to credit an amount in accounts in Sub Offices.  If anything wrongly happens either in HO side or in SO side, the amount will not get credited in the corresponding accounts.

So many external factors like proper net connectivity, performance of computers, proper maintenance of communication module, etc. also determine the success of a file transfer and it’s processing. 

Even in NREGA FTO with the lesser number of accounts is taking abnormal time for processing in HOs where large numbers of NREGS accounts are opened in various Sub Offices.

While coming to DBT the volume would be very huge both in terms of number and amount so it needs extra care for processing.  Processing huge number of FTOs at a single stretch will definitely attract various types of transmission issues in eMO client since the system and networks are very slow.

In order to overcome this issue, special FTO processing strategy should be adopted especially in HOs.

Counter Management and Crowd Control

Abnormal counter traffic in single time would be a main head ache in its implementation.  Unlike eMOs beneficiaries or their representative will directly approach Post office for withdrawing the amount from their SB Accounts.  The large number of people will assemble in the morning itself at the Post Office counter and will ask for their amount before doing delivery related works or Branch Office dispatch.


The abnormal crowd in the counter will also affect the normal business of the Post Offices.  If it goes without any control surely it will end with clash between PO staffs and public.  In order to avoid these circumstances controlled disbursement method should be adopted.

Crowd can be controlled by giving limited number of token in Advance.  The number of tokens should be decided according to the work load and number of staffs in the office.
Allotting separate day for a particular range of accounts is another solution.  That means account numbers should be divided into different groups and each group should be allotted with separate week days for the disbursement.

Payment through Postmen or delivery staffs is another way for easy and reliable way of disbursement.

Most of the beneficiaries approaching Post Office are may not be able to fill the withdrawal slip independently.  This is another issue to be faced in the PO counter.


Difficulty in Cash Management

As far as B Class and C class offices which are not directly linked with any Bank are concerned, the cash management is another issue in huge pension disbursement.  Earlier itself it was an issue when huge numbers of pension money orders were received but a Postmaster or Postmen can limit the payment according to the circumstances.
 
But here Postman or Postmaster cannot predict the number of persons going to approach the office on a particular day.  At the same time maximum cash limit of these offices are very negligible compared to the actual requirements.

Timely cash conveyance should be arranged inorder to avoid public agitation in this special circumstance and maximum office should be attached with nearby Banks.

Chances of Mistakes and fraud

This is the most important concern in everyone’s mind because counter staffs cannot identify the beneficiary with the help of signature in the withdrawal slip.  Most of the beneficiaries are putting thump impression in the withdrawal slip.  Matching thump impression is not possible at present with available facility.

Photos pasted in the passbooks can be used up to a certain limit to identify the beneficiary but it is not practical in all situations.

Since the separate rule is not formed for the pension payment through POSB, withdrawing through messenger is another head ache for the counter staffs.  Genuine and fake messengers cannot be identified because of lack of signature.  Possibility of withdrawal by any of the family member without the consent of the original beneficiary cannot be rejected.

Conclusion


Concerns are not ending. But India Post needs to prove its ability to succeed in big initiative like this since it a part of e-governance or Digital India initiative.  Officials in all levels should study or handle this case very carefully and should approach very practically otherwise it will be a big flop in all sense.

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