Government banking: Progressing towards digital democracy

DK Das

Governance in India has travelled an extensive and arduous path from its nascent physical record keeping in departmental silos to open digital ecosystems (ODEs) deployed at population-scale platforms. This transition primarily has enabled a paradigm shift in delivering the social welfare programs of the government of India and helped in creating an impact.

The transition from a silo-based information network to an open knowledge sharing platform is brought into action through a three-pronged strategy which revolves around the aspects of citizen centricity, service orientation and transparency.

Transparency through public access of information to all government initiatives, budgetary allocations for social welfare programs, important decision makers, outcome and evaluation metrics of key government schemes, online registration and tracking of beneficiary application and grievance redressal, etc are a few areas where digitization has handed the control to general populace. The citizens are now more informed about the government’s outlook towards their welfare, performance and delivery of implementing agencies of these welfare programs and having a platform to raise their concerns with an assurance of redressal.

Websites like indiabudget.gov.in, india.gov.in, pib.gov.in have been instrumental in devolution of information of public services to the common man.

Citizen centricity through knowledge and information sharing among key Ministries and Departments has given the policy makers much deeper insights about the demographics, key indexes (population, sex, poverty, etc) and region-specific challenges.

This information is then transcended upon to respective state counterparts and state governments, which then helps in informed decision making and conceptualization of state-specific schemes. The knowledge management system under National e-Governance Division is a perfect example of this inter-departmental and cross-functional data and knowledge transfer. This Knowledge Management System will evolve into a knowledge hub for all governance-related projects. Going forward, this behemoth of data can be integrated into Machine learning modules and AI deep learning frameworks to accurately measure/monitor and suggest the best possible course of action when it comes to policy making and implementing welfare programs.

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Service Orientation through feedback and regulatory framework for implementing agencies to assess and build uniform service standards across the value chain by development of systems like RAS (Rapid Assessment System) for online immediate feedback of government services. While systems like RAS takes care of direct feedback loop, fund management ingenuities like PFMS (Public Fund Management System) and SNA (Single Nodal Account) ensures that there is a zero-lag and steady delivery of welfare services through implementing agencies like banks, government departments, etc.

Amalgamation of these three core ideologies has given rise to many e-Gov services which have become a part of our daily lives.

Certain initiatives like PFMS (Public Fund Management System) and SNA (Single Nodal Account) with the help of public/private financial institutions are not only bringing visibility towards spending done for social welfare programs but are also aiming for optimization of the funds used.

In this journey of bringing digital alignment in information gathering, sharing and reporting across Central Govt. and State Govt. entities, financial institutions have played a major role in terms of solution implementation, adhering to regulatory framework and reducing TAT in fund disbursement.

Axis Bank has supported these e-Government initiatives through customised solutions, dedicated manpower, and integration of proprietary government software through APIs.

In PFMS, the bank came through with a customised solution (Dashboards) for the departments while also lending a hand in training of Govt. Officials. This was even supplemented with a dedicated team to assist with all PFMS on-boarding and queries for various departments.

For SNA, the bank has customised its proprietary LMS (Liquidity Management System) in accordance with the requirements of SNAs Parent-child account concept. This has helped in reducing the TAT for limit creation in the child accounts, provide a real-time reconciliation, and has enabled the departments to process bulk transactions with ease. With a disproportionate focus and dedicated after sales team, the bank is committed towards the government’s initiative of transparent and efficient fund disbursal for welfare schemes.

While acting as a catalyst, the bank has also integrated the Bharat Bill Pay System (NPCI owned) which is an alternative to physical collection of various cess, taxes and utility bills for various municipal corporations and government agencies. This has led to increase in adoption of digital payments amongst the Indian population, hence reducing the cost associated with physical collection and creating a better visibility and reconciliation of funds.

While there has been an unprecedented growth in making governance more transparent, citizen-centric and service-oriented, there are still some challenges which need to be addressed to make it more robust and efficient.

Economic Challenges: The cost of infrastructure deployed in e-Governance is high which is coupled with the regular maintenance and operability of the core IT systems such as servers and mainframe terminals. Along with these issues, the availability of basic infrastructure such as electricity and internet is also a critical factor to be considered in this regard. Uniform sustenance of these critical building blocks also adds up to the already existing cost. Government initiatives like BharatNet and Saubhagya are major enablers in this direction.

Social Issues: The usage of e-Gov services in hinterlands where factors like affordability and awareness play a huge role in demarcating the rural population into users and non-users is also a critical issue. At times, non-availability of services in local languages also plays a hindrance in last mile delivery.

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Technical Challenges: e-Governance is based on collection of citizen’s crucial data points, therefore it becomes very critical that security and privacy is the paramount focus while dealing with such sensitive information, also security interoperability amongst different platforms is a major challenge when it comes to multi-platform operations. Hence, the need for an open architecture with strict security protocols and safeguards is the way forward in implementing e-Governance.

While the challenges remain, a hybrid workaround can be effective where a man and machine combination can supplement the lack of ideal infrastructure.

These initiatives will not only help us in understanding the grass-root factors but will also bring a synchrony amongst the government machinery such as bureaucrats, elected representatives, and implementing agencies. This positive synergy can bring about a revolution in terms of cost reduction and transparency, which will indeed increase efficiency of welfare programs. Therefore, it will be safe to say that e-Governance will be a key aspect enabling India to become a 5 trillion dollar economy in near future.

Views expressed are the personal opinion of DK Das, EVP & Head Government Banking Business, Axis Bank.

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