The Government of India to launch the Central Bank Digital Currency (CBDC)-based Direct Benefit Transfer (DBT) in the Union Territories of Chandigarh and Dadra & Nagar Haveli
Read or download the official PDF of this gazette notification issued by the Ministry of Corporate Affairs on 12th August 2026. Classified under Press Release.
Executive Summary
The Government of India is launching a Central Bank Digital Currency (CBDC)-based Direct Benefit Transfer (DBT) system for food subsidies under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) on 14 August 2026. Initially rolling out in the Union Territories of Chandigarh and Dadra & Nagar Haveli, the initiative replaces conventional bank transfers with programmable Digital Rupee tokens delivered to digital wallets. This rollout serves as a proof of concept for national scalability, aiming to enhance transparency and financial inclusion in the welfare delivery ecosystem.
Key Points / Main Content
Implementation Details
Launch Date: Scheduled for 14 August 2026.
Target Locations: Chandigarh and Dadra & Nagar Haveli will be the first Union Territories to operationalize this system.
Primary Scheme: The initiative covers food subsidy transfers under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY).
Background: The rollout follows earlier pilot implementations in Puducherry and Gujarat.
Operational Mechanism
Digital Wallets: Beneficiaries will receive food subsidies as programmable CBDC (Digital Rupee) tokens directly into their CBDC wallets.
Transaction Process: Subsidies are used to purchase foodgrains from empanelled merchants via a secure, real-time digital payment mechanism.
Traceability: The use of programmable tokens ensures that funds are traceable and used specifically for their intended purpose.
Strategic Objectives
Efficiency: Seeks to reduce leakages, diversions, and cash handling associated with traditional delivery methods.
Accountability: Enables real-time monitoring of subsidy utilization and strengthens the Digital Public Infrastructure.
Financial Inclusion: Promotes digital adoption through simple, wallet-based transactions for all eligible beneficiaries in the targeted regions.
Impact Analysis
Eligible PMGKAY BeneficiariesImpact
Beneficiaries will transition from traditional bank account transfers to receiving digital tokens in CBDC wallets, facilitating instant and secure transactions.
Action Required
Beneficiaries must use their CBDC wallets to receive subsidies and conduct transactions with empanelled merchants to purchase foodgrains.
Empanelled MerchantsImpact
Merchants will be part of a secure, traceable, and real-time digital payment ecosystem for foodgrain sales.
Action Required
Merchants must facilitate and process payments using the CBDC-based digital payment mechanism.
Other States and Union TerritoriesImpact
These entities are presented with a scalable template and proof of concept for future adoption of CBDC-integrated welfare schemes.
Action Required
No immediate action required, but they are expected to observe the operational experience for potential future implementation.
Key Entities Referenced
Central Bank Digital Currency (CBDC): The programmable Digital Rupee tokens used as the primary mechanism for delivering food subsidies directly to beneficiaries' digital wallets.
Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY): The national food security scheme under which the CBDC-based Direct Benefit Transfer model is being launched.
Direct Benefit Transfer (DBT): The policy framework for the transparent and traceable delivery of government subsidies directly to eligible beneficiaries.
Chandigarh and Dadra & Nagar Haveli: The first Union Territories in India to operationalize the CBDC-based subsidy transfers to PMGKAY beneficiaries.
Ministry of Company Affairs
The Government of India to launch the Central
Bank Digital Currency (CBDC)-based Direct
Benefit Transfer (DBT) in the Union Territories of
Chandigarh and Dadra & Nagar Haveli
प्रव तथ: 12 AUG 2026 7:07PM by PIB Delhi
The Government of India will launch the Central Bank Digital Currency (CBDC)-based Direct Benefit
Transfer (DBT) under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) in the Union
Territories of Chandigarh and Dadra & Nagar Haveli on 14 August 2026. The launch will be graced by
Union Minister for Consumer Affairs, Food and Public Distribution, Shri Pralhad Joshi, Governor of
Punjab and Administrator, U.T. Chandigarh, Shri Gulab Chand Kataria, Union Minister for Agriculture
and Farmers Welfare, Shri Shivraj Singh Chouhan; Minister of State for Consumer Affairs, Food and
Public Distribution, Smt. Nimuben Jayantibhai Bambhaniya, and other dignitaries.
The launch of CBDC-based DBT under PMGKAY marks a significant milestone in India’s journey
towards building a modern, transparent and technology-driven welfare delivery ecosystem.
Chandigarh and Dadra & Nagar Haveli are set to become the first Union Territories in the country to
operationalize food subsidy transfers to all eligible PMGKAY beneficiaries in the form of programmable
Central Bank Digital Currency (CBDC – Digital Rupee) tokens directly into their CBDC wallets.
Building on earlier pilot implementations in Puducherry and Gujarat, the rollout marks complete digital
adoption and saturation of all eligible beneficiaries across the targeted Union Territories.
Under the CBDC-based DBT model, eligible PMGKAY beneficiaries will receive food subsidy directly
into their CBDC wallets instead of conventional bank account transfers. The subsidy can then be used to
purchase foodgrains from empanelled merchants through a secure, traceable and real-time digital payment
mechanism.
The CBDC-enabled DBT model seeks to ensure transparent and end-to-end traceable delivery of
public funds, while reducing leakages, diversion and cash handling associated with traditional
subsidy delivery mechanisms. It will also facilitate instant and secure transfer of benefits to
beneficiaries and promote financial inclusion through simple wallet-based transactions.
The initiative will further strengthen accountability and real-time monitoring of subsidy utilization and
demonstrate the potential of the Digital Rupee for future payment systems.The rollout is envisaged as a proof of concept for the nation and a scalable template for adoption by other
States and Union Territories. It is expected to provide valuable operational experience regarding the
integration of CBDC with welfare schemes and support the Government’s vision of strengthening Digital
Public Infrastructure and delivering citizen-centric services through innovative technologies.
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IA/RP
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