Periyakanganankuppam - Rural ATM for NREGS

On the Chennai-Cuddalore Road, a few kilometers outside the town of Cuddalore, we noticed a small building alongside the road crowded with a lot of women. It turned out to be the first Rural ATM for NREGS in TamilNadu and that was the queue of beneficiaries lined up to collect their wages through the ATM. It was an installation designed by Vortex and IIT Chennai. It is designed more like a cash dispenser with biometric access and a simple vernacular interface and is mainly utilized for cash withdrawals. Since it is still early stages of implementation, there was a gentleman who helped the women with keying in the amount they wanted to withdraw and we could hear women saying “Please get me R.150 for 2 weeks. Last week I did not get paid”.

It was about 4 pm in the evening and there was no electricity, which is not a surprise anymore to the locals, but the gentleman was able to manage the impatient crowd because of the solar backup. The ATM is designed with a photovoltaic cell array and battery backup. It is a fairly workable model which updates the data online and offline modes and has even won an award for the District Collector at the National/Sate level. But like many other installations where solar is involved, it costs as much as the equipment it is supposed to provide back up power to. In this case, it is about Rs.200,000 each. This is probably a key reason for the solar not being able to scale up.

A quick point on the solar energy and India. A few years ago, when we tried to implement solar back-ups for community based water plants and computer centers attached to Govt schools in Andhra Pradesh, provoked by a question from R.Gopalakrishnan of Tatas, we faced a similar dilemma, in spite of working with arguably the best team in the country for solar solutions. A little research shows that the price of solar cells has been following almost a downward spiral for more than two decades (with 8 years as average cost-halving time), but it has still not reached the Tipping Point, mainly because of the technology and the material used. Even the National Solar Energy Mission projects a tariff parity with coal in the year 2030 !! Hence, solar appears to be a viable energy solution , only when the other modes are either not feasible or unavailable. Villages electrified by solar energy in Sunderbans is a classic example. With decentralisaion of power generation, one day there is bound to be multitude of small systems designed for domestic and commercial use, like the gensets and battery sets one sees today. It is in these areas where India has to get aggressive with US, Europe and Japan(they have almost the entire Photo voltaic market today) for technology transfer, access to new research etc, as part of the Climate change conventions and treaties. China incidentally has become the largest producer of solar products, with a 25% market share, in less than ten years. India of course has a miniscule share at the moment.

Coming back to the Rural ATM, the recent RBI regulation permitting cash withdrawals at POS terminals (Point of Sale (POS) terminals are the ‘swiping’ machines you encounter at shops and restaurants) for amounts till Rs.1000 is going to have an interesting impact on the ATM market. RBI data says that the country will soon have almost 500,000 POS terminals as against about 50,000 ATMs. POS is obviously cheaper and better (can work on telephone line, limited power requirement etc) for cash withdrawals, which is probably the primary need for the ATMs from the customers’ point of view. There is no reason why the entire postal system, railways and other systems with daily interaction with the masses cannot have the ‘cash boxes’ soon and it can certainly make the NREGS cash distribution more effective in a single stroke.

Tail piece: Unfortunately, the NREGS is following the footsteps of SHGs in terms of measuring success in amount of rupees disbursed and no of Job cards issued, instead of actual accomplishment of public structures built.