Pension payment for BPL families and unorganised sector targeted at nearly 300 million workers, can be paid through bank accounts thereby not only saving the cost of making the payments, but also minimising leakages and pre-empting payments in the names of persons who do not actually exist.
Bio metric smart cards /mobile technology and use of business correspondents as agents by banks have made “no frills” banking accounts accessible to low income families. A very successful example of using such accounts for old age pension payments can be seen in the State of Andhra Pradesh, where a pilot carried out in the Warangal district is being upscaled to cover all districts.