Gujarat becomes first State to establish cashless system for distribution of food grains

Establishment of a cashless system for distribution of food grains was mandated by the Union Government to achieve the objectives of Digital India initiative.

Feb 9, 2017 13:37 IST
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Gujarat in the first week of February 2017 became the first State in the country to establish a cashless system for distribution of food grains.

An announcement in this regard was made by the Union Minister for Consumer Affairs, Food and Public Distribution Ram Vilas Paswan, who congratulated the Government of Gujarat for this achievement.

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Details related to Cashless System in FPSs of Gujarat

• The Government of Gujarat installed Aadhaar Enabled Payment System in 17250 Fair Price Shops (FPSs), much before the targeted date of 31 March 2017.

• Under this new system, the beneficiaries under the National Food Security Act, 2013 will need to carry only Aadhaar cards for getting their food grains.

• This will help in establishing the identity of beneficiaries, help in stopping the leakages of grains at shop level and eradicating corruption in the Public Distribution System (PDS).

Reforming the FPS System in Gujarat

 • The Gujarat Government has partnered with common service centers (CSCs), a Special Purpose Vehicle (SPV) of the Union Ministry of Electronics and Information Technology (MeitY), by offering 30 odd digital services through the FPSs.

• This partnership will enable consumers to get his/her rail, air and bus tickets reserved in fair price shops.

• A beneficiary can also pay his mobile bill, a farmer can deposit crop insurance premium and LIC premium in these centers.

• A farmer can get the Soil Health Card (SHC) and get registered for Centrally Sponsored Schemes (CSSs).

• The FPSs have been equipped with the necessary infrastructure to provide basic computer and internet services.


• The Union Minister for Consumer Affairs, Food and Public Distribution Ram Vilas Paswan on 19 January 2017 organized a meeting with State food ministers for establishing cashless system in the public distribution system across the country.

• At the meeting, a majority of States agreed to provide cashless arrangements by 31 March 2017.

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