PFMS - Public Financial Management System | All About PFMS

The word management has always connoted something that is arranged in its very well form. People says managing everything in life is easier than managing a finance. But the PFMS which means Public Finance Management system has given a new dimension of financial management which is backed up with technological innovations. The PFMS is earlier known as Central Plan Scheme Monitoring System. In common words PFMS is used by the government agencies to pay directly to the recipient’s bank account.

The common aim behind the use of PFMS is to give the users a common platform for e-payment of subsidy under direct benefit transfer (DBT) TO both the account users, that means Aadhar and non-Aadhar based bank accounts through NPCI.

The use of PFMS has enable the government in taking forward the DBT initiatives and the most important benefit is that it will target the beneficiary and prevent the leakages and duplication in form of ghost beneficiaries too.

As PFMS is backed with e-payment systems so, the timely payment to the beneficiary can be ensured by the government end and of course delay can be prevented too.

As the timely transfer of amount to the citizen can be done through PFMS, so it ensures efficiency, effectiveness, transparency and accountability of the government system and process too.

If any customer is wiling to check their PFMS account balance then they have to spare just few minutes, they can give a missed call on a toll- free number 1800 180 2223 and tolled number 0120-2303090 to check the account balance through SMS. The service is free of costs and every PFMS account holder can reap the benefits from their nearest branch.

The PFMS system is established as a web -based system that helps the fund management and electronic transfer of funds to implementing agencies and beneficiaries. Many of the banks have implemented DBT payments through PFMS for the beneficiaries covered under the scheme.

According to the sources the budgetary outlay of the PFMS is 6,66, 644 Crore. The PFMS has tremendous potential improve financial management. It enables the just in time release of fund, that reduces the float in the financial system. The time in release of funds also helps the government borrowings with direct impact on interest cost.

The common advantage is that PFMS helps as an aid in tracking and monitoring the flow of funds to the implementing agencies. The transparency of the funds can be seen as one can known the actual status of the fund utilisation by the multiple implementing agencies including central as well as the State government.

The primary object behind the PFMS is to link the financial networks of Central and the State Government and the agencies of the State Government. The Controller General of Accounts (CGA) rolled out the PFMS. It can be traced back to 2009, when PFMS was started as Central Sector Scheme of Planning Commission to track funds released under Government of India.

In 2013, the scope of PFMS was expanded to cover direct payment to beneficiaries under different schemes. In the year 2014 the digitalization of the bank accounts was achieved through PFMS. The web-based software was developed and implemented by CGA.

The common benefits can be merged as it provides transparency related to the government borrowings, it can be said as common platform to track the flow of funds. It ensures on time money transfer including Direct Benefit Transfer. Through PFMS real time monitoring and disbursements of funds is easier than before.

According to the sources PFMS is an addition to the progressive financial management of India and can be better understood as a comprehensive Payment, receipt and accounting system. The improved management of funds is achieved through PFMS. It is considered as meaningful management information system to various stakeholders. The Indian financial system supports real time expenditure at all levels through PFMS.

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