The Controller General of Accounts (CGA), Department of Expenditure, Ministry of Finance has developed a fully secured Government e-payment system for direct credit of dues from the Government of India into the account of beneficiaries using digitally signed electronic advice (e-advice) through the ‘Government e-Payment Gateway’ (GePG).
Government e-Payment Gateway (GePG) is a portal which enables the successful delivery of payment services from Pay & Accounts Offices (PAOs) for online payment into beneficiaries’ accounts in a seamless manner under a secured environment.
GePG serves as middleware between COMPACT (Computerized Payment and Accounts) application at Pay & Accounts Offices and the Core Banking Solution (CBS) of the agency banks/RBI to facilitate paperless transaction, reducing overall transaction cost and promoting green banking.
Government e-Payment Gateway (GePG) is a portal which enables the successful delivery of payment services from Pay & Accounts Offices (PAOs) for online payment into beneficiaries’ accounts in a seamless manner under a secured environment.
GePG serves as middleware between COMPACT (Computerized Payment and Accounts) application at Pay & Accounts Offices and the Core Banking Solution (CBS) of the agency banks/RBI to facilitate paperless transaction, reducing overall transaction cost and promoting green banking.
This system will bring transparency and expedite direct payments from central paying units relating to subsidies to the users and consumers of fertilizer, kerosene and cooking gas which is already a declared objective of the government. This will increase the adoption of other e-services due to its efficiency and ease-of-use for all Central Government Ministries and Departments for online payment transactions.
The digitally signed e-advices uploaded by the PAOs on GePG portal is downloaded by the concerned banks to credit the beneficiaries’ accounts through CBS/NEFT/RTGS as applicable.
The e-payment system will save time and efforts in effecting payments and will facilitate elimination of physical cheques and their manual processing. Further the constraints of manual deposit of cheque by the payees into their bank account would also be eliminated. The system will also have online reconciliation of transactions and efficient compilation of payment accounts.
The report talked about how the current payment inefficiencies cost Rs 1 lakh crore annually with a large share of that amount — Rs 71,000 crore — attributed to welfare schemes disbursed by the Government.
Outside entities working for these ministries will also receive their payment through the mechanism. The Government aims to bring all the Civil Ministries and departments into the system by March 31, 2012. Defence, Post & Telegraph and Railways are the civil ministries
The digitally signed e-advices uploaded by the PAOs on GePG portal is downloaded by the concerned banks to credit the beneficiaries’ accounts through CBS/NEFT/RTGS as applicable.
The e-payment system will save time and efforts in effecting payments and will facilitate elimination of physical cheques and their manual processing. Further the constraints of manual deposit of cheque by the payees into their bank account would also be eliminated. The system will also have online reconciliation of transactions and efficient compilation of payment accounts.
This system covering all Central government departments and ministries is expected to eliminate almost two crore cheques. When it becomes fully operational in Civil Ministries, Defence and Railways, it is expected to cover a total payment of over Rs 6,00,000 crore.
The consulting firm McKinsey, in its report last year had remarked that the infrastructure to enable an e-payment model will entail a one-time cost of Rs 60,000-70,000 crore, an amount that can potentially be paid back within one year from the savings incurred through an e-payment infrastructure.
The report talked about how the current payment inefficiencies cost Rs 1 lakh crore annually with a large share of that amount — Rs 71,000 crore — attributed to welfare schemes disbursed by the Government.
Employees of 11 Central ministries and departments, such as Petroleum and Natural Gas, Civil Aviation, Coal, Health and National Information Centre, will get their salary through the new mechanism.
Outside entities working for these ministries will also receive their payment through the mechanism. The Government aims to bring all the Civil Ministries and departments into the system by March 31, 2012. Defence, Post & Telegraph and Railways are the civil ministries
Under the traditional system of government payments, paying units in central government are using cheque, cash, DD or in few ministries ECS for payments to employees and vendors. In the past few years RTGS and NET faculties provided by RBI are also being utilized for central government payments in various ministries through the banking channel.
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