For every e-NAM deal worth Rs 100, just Rs 1 routed via DBT

By Prabhudatta Mishra

If the electronic national agriculture market (e-NAM) is under-performing, the picture is even more abysmal when it comes to direct transfer of the sale proceeds to the farmers’ bank accounts through the facility.

Between e-NAM’s early 2016 launch and May 2020, a measly Rs 1,050 crore has been paid to farmers through e-payment facility, even as e-NAM transactions during the period was over Rs 1 lakh crore. Though the updated figures are not immediately available, trade sources say e-payments continue to be at the same level even now.

The principal reason for direct electronic transfer of funds to farmers’ bank accounts being low is the state government’s reluctance to implement the scheme. Although 100% direct transfers is integral to e-NAM and the Centre has been insisting on it, it is not mandatory on states to follow the policy.

Cashless transaction is key to success of intra-state and inter-state trading among mandis on e-NAM portal, which is designed to improve market access to farmers and thereby ensure remunerative returns to them.

The turnover of trade on e-NAM increased 74% on year to Rs 30,845 crore during FY20. The volume went up 44% to 77.13 lakh tonne during the period. e-NAM is an online trading platform for agricultural commodities across states.

So far, 1,000 mandis across 18 states and three Union Territories have been integrated with e-NAM platform. In her Budget speech this year, finance minister Nirmala Sitharaman had announced integration of 1,000 more mandis under e-NAM.

According to an impact assessment report of Jaipur-based National Institute of Agricultural Marketing (NIAM) on performance of e-NAM, submitted in October last year, “significant number of farmers opined prompt payment of sales proceeds” on the electronic platform. While States are not ready to make the transaction in mandis cashless, the Centre fears that a forceful implementation will not be helpful to attract trade, sources said. Besides, the income tax department allows only up to Rs 2 lakh of cash transaction per day per trader.

Farmer leader Rakesh Tikait has been raising this issue of direct payment into the bank accounts of farmers. “The record of payment will also be a proof of what prices farmers actually receive for their produce,” Tikait said adding cashless transaction should also be followed once the government accepts their demand of a legal guarantee of the minimum support price (MSP) mechanism.

In addition to e-payment facility, e-NAM transactions can also be settled through cash payment, cheque payment, Real Time Gross Settlement (RTGS), National Electronic Funds Transfer (NEFT), Debit Card and Internet Banking. When payment happens outside e-NAM platform, the local APMC has to certify the settlement to complete the transaction.

The Centre has already launched a trading module that allows farmer producer organisations (FPOs) to trade their produce from their premises without bringing the produce to APMC mandi where e-NAM platform is also located. Warehouse based trading module has also been provided in e-NAM to facilitate trade from warehouses based on electronic-Negotiable Warehouse Receipt (e-NWR). However. states need to permit FPOs and warehouses to facilitate the operation under e-NAM.