Fertiliser subsidy is the second-largest subsidy after food that the Government of India provides. In the Union Budget 2016-17, the Indian government proposed to bring fertiliser subsidy under the ambit of the Direct Benefit Transfer (DBT) programme to streamline its distribution. The government announced pilots for Direct Benefit Transfer in Fertilizer (DBTF) on 28th March, 2016 in 19 districts across India. DBTF is a modified subsidy payment system under the DBT scheme. Here, fertiliser companies receive subsidy only after retailers have sold fertiliser to farmers or buyers through successful Aadhaar authentication via Point of Sale (PoS) machines.
On a request from National Institute for Transforming India (NITI)- Aayog, MicroSave conducted an assessment in 14 districts across the country where DBTF pilots have been running live. These are Rangareddy, Pali, Una, Hoshangabad, Krishna, West Godavari, Karnal, Kurukshetra, Kishanganj, Thrissur, Narmada, Tumkur, Nashik, and Raigarh. MicroSave assessed the aggregate responses from 5,659 farmers and 427 retailers across 14 districts and also conducted in-depth interactions with the concerned government officials and district consultants. The report elaborates key findings of the study on multiple aspects including DBTF implementation status, transaction status and the perception of farmers on the new DBTF system. The report also provides actionable solutions for smooth implementation of the DBTF initiative.