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Direct Benefit Transfer Scheme and Farm Mechanisation in India

Updated on 09th February, 2024, By Neesha Rathod
Direct Benefit Transfer Scheme and Farm Mechanisation in India
Direct Benefit Transfer (DBT) scheme has changed the way government subsidies were transferred to the beneficiaries. It directly transfers subsidies like tractor subsidy directly into the bank account of the farmers.

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For decades, Indian farmers have relied on various subsidies, including fertilisers, seeds, and crop insurance, to support their agricultural activities. However, these subsidies often faced issues of inefficiency, corruption, and misallocation. The traditional subsidy system involved multiple layers of intermediaries, from government agencies to local distributors. It led to leakages and delays in providing support to the intended beneficiaries.

In recent years, the Indian government has taken several measures to stop the leakages in subsidy transfer to the intended beneficiaries. This includes Direct Benefit Transfer (DBT) Scheme, which is one of the top government schemes of India.

Introduction of Direct Benefit Transfer

To address these challenges, the Indian government initiated the Direct Benefit Transfer program on 1 January 2013. Under DBT, subsidies are transferred directly to the bank accounts of farmers, eliminating the need for intermediaries. The benefits covered under 34 central schemes are directly transferred to the under-privileged population.

Some of the key schemes related to agriculture under DBT include:

  • National Mission for Sustainable Agriculture
  • National Livestock Mission   
  • PM Kisan Scheme 
  • Pradhan Mantri Fasal Bima Yojana

What is the Direct Benefit Transfer Scheme?

DBT refers to a system of providing subsidies and government assistance to beneficiaries directly in their bank accounts. This scheme was aimed at reducing corruption by ensuring that the intended beneficiaries receive the relevant benefits. It has reached more than 90 crore beneficiaries since its inception.

The DBT scheme has been implemented in various sectors, including agriculture. Under the DBT scheme for agriculture, the government transfers subsidies, and benefits directly to the bank accounts of farmers. This includes subsidies on seeds, fertilisers, pesticides, and agricultural machinery.

Components of DBT

The key components of DBT in Indian agriculture include:

  1. Aadhar Integration: Linking subsidies to the farmers' Aadhar (unique identification) numbers to prevent duplicate and ghost beneficiaries.
  2. Jan Dhan Accounts: Encouraging farmers to open bank accounts, making it easier to transfer funds directly.
  3. Mobile Technology: Using mobile technology to ensure timely notifications and alerts regarding subsidy disbursements.

How to Register for the DBT Scheme?

Registering for the DBT scheme involves a few straightforward steps. Here is how to complete DBT scheme registration:

  • Keep the necessary identification documents ready. These documents often include your Aadhaar card, bank account details and any other documents specific to the scheme you wish to apply for.
  • Access the official DBT portal, which the government typically maintains.
  • Within the DBT portal, you will find information on various government schemes. Select the scheme you are interested in and follow the registration process specific to that scheme.
  • Many DBT schemes require you to link your Aadhaar card with your bank account. Ensure your Aadhaar is linked to your bank account to receive benefits directly.
  • Fill out the application form with accurate information and submit it.
  • The benefits or subsidies under the selected scheme will get transferred to the provided bank account directly if your application is approved.

If you encounter any issues or have concerns about the DBT process, the portal often provides a means to register feedback or file grievances. Use these channels to address your concerns.

About DBT Process

Direct Benefit Transfer involves the following key checkpoints:

  1. Registration in Public Financial Management System (PFMS)
  2. Examining the eligibility of the individual
  3. Verifying Aadhar Enabled bank account of the beneficiary
  4. Payment Initiation

Benefits of DBT in Indian agriculture

Here are some of the specific benefits of DBT in Indian agriculture:

  • DBT ensures transparency in subsidy distribution, minimising opportunities for corruption and misuse of funds. It also enables better tracking of the distribution process.
  • DBT enables targeted subsidy delivery, ensuring that benefits reach the intended beneficiaries. It leads to increased equity and fairness in subsidy distribution.
  • The DBT system significantly reduces the cost of subsidy distribution by eliminating intermediaries.
  • DBT in agriculture has increased the efficiency in the procurement of inputs.
  • It promotes the adoption of technology in agriculture. By providing direct benefits to farmers, the government incentivises them to invest in modern farming practices.

Impact of DBT on Indian Farmers and Agriculture

Crop subsidy and tractor subsidy are important subsidies given to the farmers. The introduction of DBT in Indian agriculture has had an impact on many farmers. With direct subsidy transfers, they have more control over their financial resources and can make informed decisions about crop selection, investment in technology and adopting best practices. Furthermore, it has the potential to empower small and marginal farmers by providing them with equitable access to support.

Challenges of DBT in Agriculture

  • Digital Literacy: Many farmers, particularly in remote rural areas, may have limited digital literacy, making it challenging for them to access the benefits of DBT.
  • Infrastructure: Reliable internet connectivity and banking infrastructure can be lacking in some regions, hindering the seamless implementation of DBT.
  • Data Privacy & Security: Issues related to data privacy and security have been raised. The key one is regarding the storage of personal and financial information.


Direct Benefit Transfer in Indian agriculture is a significant step toward modernising the subsidy and support system. While challenges exist, the benefits of transparency, reduced leakages and increased financial inclusion make DBT a promising approach for transforming Indian agriculture. With continued efforts to address digital literacy and infrastructure issues, DBT has the potential to revolutionise the sector and improve the livelihoods of millions of farmers across the country.

Neesha Rathod
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Neesha Rathod
Neesha holds a bachelor’s degree in agriculture and a postgraduate degree in Rural Management. With over 10 years of experience in agriculture and the rural sector, she is a quick problem solver. She is inquisitive and has a deep analytics insight into any issues related to agriculture. She loves to travel and explore new places.
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