In a unique move to usher in green banking and enhance transparency and accountability in public dealings of the Centre, all payments above Rs. 25,000 will be credited directly to the bank accounts of payees from this fiscal.
The green banking facility is also being extended to payments to government servants, including for settlement of retirement and terminal benefits.
According to an official statement here on Tuesday, the Finance Ministry has amended rules to enable all ministries and departments to credit payments directly to the bank accounts of payees as part of the government's commitment to good governance and elimination of corruption.
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“Orders have also been issued by the Controller-General of Accounts (CGA) that, with effect from April 1, 2012, all payments above Rs. 25,000 to suppliers, contractors, grantee and loanee institutions shall be directly credited to their bank accounts.”
Even as government servants will continue to have the option of receiving their salaries by cash or cheque, they could also opt for direct bank transfer. However, all other payments above Rs.25,000, as also towards settlement of retirement/terminal benefits shall be directly credited to their bank accounts, says the statement.
A ‘Government e-payment gateway', set up by the CGA and inaugurated by Finance Minister Pranab Mukherjee recently, will be used by the PAOs (Pay & Accounts Officers) of various civil ministries and departments, to start with. At a later stage, the Controller-General of Defence Accounts (CGDA) will also progressively move towards making payments through this gateway.
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The measure is expected to streamline the payment process and minimise payees' interface with government offices to receive their dues, and thereby enhance transparency and accountability in public dealings.