1. INTRODUCING E-FMS
Tasks ahead

2. BACKGROUND
 Government of India in the Ministry of Rural
Development has introduced Electronic Fund
Management System (e-FMS) as a special
financial solution for expeditious payment of
wages to the job card holders working under the
Mahatma Gandhi National Rural Employment
Guarantee Act
 In the MoRD server maintained by the
NIC, Delhi and run through NREGASoft, a
special window has been created to cater to the
e-FMS needs of the states

3. BACKGROUND
 Government of India requires all the states to switch
over to e-FMS to ensure speedier payment of wages
 The new system is supposed to reduce chances of
pilferage and make the payment system more
transparent
 Government of West Bengal has taken a decision to
switch over to e-FMS in a phased manner starting
with a small pilot in one full block in April 2013
 The intention is to roll out e-FMS across the state by
end of June 2013

4. PRE-REQUISITES FOR E-FMS
 Electronic Fund Management System is at
the end of a process of use of ICT for
MGNREGA implementation. Pre-requisites of
e-FMS are
 Use of NREGASoft in complete online mode
 Use of Electronic Muster Rolls for capturing
attendance
 Complete ICT enabled environment at the level
of all Project Implementing Agencies (PIA)
 Use of Digital Signature Certificates (DSC) by
the functionaries

5. STEP-I
 Identify area for pilot intervention
 Preferably one block
 Completely online
 Using e-Musters only
 Mostly Bank accounts
 Preferably in Nationalized Banks
 Strong internet connectivity in all the Gram
Panchayats
 The block and the GP teams having strong
commitment to transparency, quality and innovations

6. STEP-2
 For identified pilot block
 Open accounts for all active households, individually
for all members
 Verify all active accounts
 Name of the worker and account no.
 Bank
 Branch
 IFSC
 Job Card Number
 On validation take those as the only accounts for all
transactions against the wage seekers in question
(in e-FMS term this is known as freezing of
accounts)

7. STEP-3
 Initiate the process of procurement of Digital
Signature Certificates (DSC) for all identified
signatories
 DSC is to be procured by name for all individual
users
 For procurement of DSC, we would be requiring
details of all the proposed signatories
 Prepare guidelines drawing money through
e-FMS
 Arrange extensive training for all
functionaries

8. STEP-4
 Open a specific e-FMS account in the SEGF
 Earmark some amount for the e-FMS
account
 Identify a leader bank for management of the
e-FMS account and technical interaction with
the MoRD server
 In association with the banks, open accounts
for all the wage seekers and validate the
existing accounts

9. ACTIVITY FLOW
 Gram Panchayat (GP) to register demand
and allocate work
 Programme Officer (PO) to generate e-
Musters
 GP to print e-Musters
 Attendance to be taken in the field by using
e-Musters only
 Measurement to be taken, preferably by
using e-MB

10. ACTIVITY FLOW
 The PIA to generate wage-lists
 Single list for single work, whatever be the bank of the
wage seekers
 If there are accounts of wage seekers in Post Offices,
separate wage list may be required
 The PIA to generate FTO
 (There will be single FTO for a PIA on a day, irrespective
of the number of works/ banks/ branches etc.)
 First signatory to verify and authenticate
 The Second signatory to approve/ reject

11. ACTIVITY FLOW
 The FTO travels directly to NREGASoft and gets
deposited into the e-FMS depositpry
 The leader bank to pick the FTO up and segregate
bank-wise
 Concerned banks to segregate branch-wise
(The task of segregation, both bank-wise and branch-wise may
also be done by the leader bank. In such a situation, other
banks will only be the recipients.)
 Once the amount is deposited into the wage seeker
account, mostly on the same day when the FTO is
generated by the PIA, or on the next day, the wage
seeker is free to withdraw money from the account

12. ACTIVITY FLOW
 PIA is to wait for a day to see whether all the
authentications are accepted by the system
 If so, enter the transactions in the cash book, both
on receipt and payment sides
 If not, write the accepted amount only in the cash
book
 Seek reasons for rejection
 Rectify
 Regenerate the rejected portion of the FTO after
rectification which will be taken as a fresh FTO for
the reconciled amount.

13. •WHAT NEXT?
 e-FMS ensures expeditious deposit of wage earned
into the account of the wage seekers
 But we need to ensure that the wage seeker can
withdraw money from her account whenever she
wishes
 With minimum travel
 Without any hassles
 Here comes the issue of financial inclusion
 The FIP (financial Inclusion Plan) of the banks are
to be vigorously pursued to ensure all wage
seekers have accounts and can get financial
services at the doorstep
 Business Correspondents and Local Service Points
might be the solution. This has to be explored.