Public Financial Management System (PFMS)
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Overview
The Public Financial Management System (PFMS) is a financial management platform developed by the Government of India. It aims to ensure a reliable tracking of fund disbursement and facilitate management of such disbursements to various government schemes.
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Objectives
– Efficient Fund Distribution: To facilitate direct payment to beneficiaries and financial monitoring.
– Transparency and Accountability: To provide a real-time tracking system for disbursements and utilization of funds.
– Financial Reporting: To enable transparent reporting of financial data across departments and ministries.
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Key Features
– Direct Benefit Transfer (DBT): Streamlines the process of transferring subsidies directly to the beneficiaries’ bank accounts.
– Expenditure Management: Monitors and manages government expenditures to prevent leakages.
– Financial Inclusion: Promotes financial inclusion by ensuring funds reach the intended beneficiaries.
– Integration with Banking Systems: Collaborates with banks to ensure seamless transactions and validations.
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Benefits
– Reduces Administrative Costs: Automates processes and reduces the need for intermediaries.
– Enhances Efficiency: Offers a streamlined approach for financial management, reducing delays.
– Improves Policy Implementation: Through accurate data tracking and reporting, assists in evaluating the effectiveness of various governmental schemes.
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Implementation
– Implemented by the Controller General of Accounts (CGA) under the Ministry of Finance.
– Utilized across various government schemes to enhance fiscal effectiveness.
Conclusion
PFMS plays a crucial role in the governance framework by improving the efficiency, transparency, and accountability of financial management in governmental schemes. It stands as a pivotal tool in propelling India’s move towards a more digital and accountable financial administration.