The Indian state of Tamil Nadu in mid-September plans to test the use of biometric smart cards to help disburse pensions in an effort to prevent corruption in the process of delivering cash payments to recipients.
A pilot project will launch in the districts of Cuddalore, Trichy and Kanyakumari, enabling recipients to receive monthly cash allowances through the new system.
Under the existing system, administered by the state revenue department, postmen deliver pension funds in cash to recipients at their homes.
“These postmen were known to take bribes from old age pensioners to disburse their pension payments,” says an official at the revenue department, who asked not to be identified.
Under the pilot program, bank representatives equipped with a biometric smartcard reader will visit pension recipients and authenticate the recipient's identity via a fingerprint, the official says.
The card reader is equipped to produce a receipt of the transaction, the official says.
The state’s revenue department has captured the fingerprints and images of the beneficiaries that have agreed to participate in the pilot, and state-owned banks including State Bank of India Ltd, Canara Bank Ltd, Bank of India Ltd, Indian Overseas Bank Ltd, and Indian Bank Ltd have assigned representatives to participate in the pilot.
A total of 25,000 people in 268 villages will participate in the pilot, which could be expanded to include 2.5 million pensioners in the state in the state if it is successful, the official says.
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