Now get financial services with rations in stores

Among the country’s ubiquitous Fair Price Shops (FPS), several thousand will become agents of financial services for the masses, a move that will catalyze the process of financial inclusion and boost digital connectivity in remote areas. This will provide FPS licensees with additional revenue streams, which will serve as an incentive to stay in business and also ensure greater reach of the public distribution system (PDS).

More than 3 lakh Common Service Centers (CSCs) are currently providing various electronic services to people including registrations for Aadhaar and PAN cards, booking train tickets, music downloads, checking bank balance and access to information on the eligibility of various schemes for citizens of rural areas.

Under the Digital India program of the Ministry of Electronics and Information Technology (Meity), the plan is to increase the number of CSCs to cover nearly 6 lakh villages over the next two years. While no less than 8,000 CSCs are currently attached to FPS, the government aims to create another 10,000 such service centers over the next year with FPS outlets, which are service centers of the last mile for the implementation of the national law on food safety. (NFSA).

A memorandum of understanding exists between the Department of Food and Public Distribution (DFPD) and Meity to transform FPS into CCS. Outlets that perform both functions are now located in Uttarakhand, Gujarat, Himachal Pradesh, Madhya Pradesh, Jharkhand, Rajasthan and Tamil Nadu.

“We encourage FPS owners to provide a host of services under the CSC platform, in addition to acting as a correspondent bank for the provision of financial services,” Sudhanshu Pandey, secretary of the DFPD, told FE.

Currently, there are 5.34 lakh FPS in the country which distribute an average of 60-70 million tonnes of subsidized food grains annually under the NFSA to over 80 million beneficiaries. Official sources said there is potential to generate additional income from FPS as a large number of people visit these outlets to get their monthly grain entitlement.

The Ministry of Food is currently working on a plan to separately color code FPSs that are also used as CSCs to distinguish them as public service delivery points. The ministry, in conjunction with the Financial Services Department of the Ministry of Finance and the State Bank of India, has also approved a scheme that would allow FPS dealers to access bank credit under Pradhan Mantri Mudra Yojana, which provides loans of up to at Rs. 10 lakh to unincorporated, non-agricultural, small and micro businesses.

“Through access to Mudra loans, FPS dealers can invest in building infrastructure at outlets to sell essential food and non-food items, which would increase their income,” Pandey said.

As FPS become service delivery points for various services, the Ministry of Food has also communicated to the Ministry of Communications to expand BharatNet connectivity to around 12,200 FPS in states that are experiencing digital operation issues due to poor network connectivity.

Officials said discussions are underway to allow FPS dealer registration to operate as public data bureaus under the Prime Minister’s Wi-Fi Access Network Interface (PM-WANI), which would help extend Internet services to people in rural and remote areas.

As part of the reforms undertaken to improve the targeted PDS, the government has initiated several measures such as digitization of ration cards, Aadhar seeding of ration cards and installation of Electronic Point of Sale (ePoS) machines in the FPS. At present, more than 95% of the 5.34 lakh FPS located across the country have ePoS machines.

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