MICROFINANCE PAPER WRAP-UP: “Digital Cash Transfers for Stranded Migrants,” by Anit Mukherjee, Published by Center for Global Development

In light of efforts by government entities to assist internal migrants within India whose lives have been disrupted by the COVID-19 pandemic, Mr Mukherjee argues that “unlike countries such as Brazil or Pakistan, India does not have a unified beneficiary database or social registry that could be used to identify, target, register and pay those in need of assistance.” The bureaucracy of India’s social assistance programs, which are fragmented among various departments and ministries, created barriers to delivering COVID-19 relief to workers that have migrated from villages to cities.

Launched in April 2020 by the state of Bihar, the Corona Sahayata (Assistance) program distributed welfare transfers of INR 1,000 (USD 15) directly to the bank accounts of migrants from Bihar who were stranded outside the state. Workers could register through a mobile application or by contacting the Bihar State Disaster Management Agency. Many migrants were unable to utilize the program because they work in the informal sector and could not show proof of residence outside Bihar or of having a bank account registered in Bihar. Within a month of the program’s launch, 2.9 million people submitted applications, and – as of May 24 – 2.0 million were paid through India’s Direct Benefit Transfer platform.

As shortcomings of the program, Mr Mukherjee notes the limited amount of cash assistance and difficulties in verifying bank accounts. Without judging the efficiency of the program, the author approves “of a sub-national government’s effort to identify, onboard and pay a specific segment of the population (ie, migrants) adversely affected by the pandemic, doing so remotely, at scale and without the benefit of an existing database, using a ‘digital first’ identification and payments approach to transfer funds quickly and efficiently.”

This is a summary of a paper by Anit Mukherjee, published by Center for Global Development, October 2020, 7 pages, available at https://www.cgdev.org/publication/digital-cash-transfers-stranded-migrants-lessons-bihars-covid-19-assistance-program

By Romil Pandey, Research Associate

Additional Resources

Center for Global Development homepage
https://www.cgdev.org/

Government of India, Direct Benefit Transfer platform homepage
https://dbtbharat.gov.in/

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