The stipend, however, will be paid after the establishment pays its share of 75% to the beneficiary. Under the new scheme, the ministry will also undertake capacity building of the apprenticeship ecosystem and provide advocacy assistance to support rapid growth of apprenticeship in India, a senior government official said.
According to the official, routing stipend payment through DBT will help identify leakages in financial disbursement under NAPS, formalise the offline modes of stipend payment system, which was resulting in delays in payment, and make apprenticeship aspirational among youth.
The entire process of DBT will be hosted on the apprenticeship portal with limited manual intervention. The ministry of skill development and entrepreneurship had launched a pilot project in July 2022 and disbursed Rs 22.29 crore to 155,000 apprentices associated with 1,544 establishments.
“It is always better to do a direct transfer to avoid time lag and leakages in the system, if any,” a senior official at the Confederation of Indian Industry said.
Finance minister Nirmala Sitharaman, in her Budget speech on Wednesday, said direct benefit transfer (DBT) will be used to extend financial support to 4.7 million youths in three years under the pan-India National Apprenticeship Scheme.
“The delay in processing and process being cumbersome actually was a deterrent for many companies in wanting to use the apprentice promotion scheme. Enabling DBT for stipend payment will benefit youth as well as companies as they would not have to wait for three to nine months to get the financial benefits in their accounts,” the Indian Staffing Federation said
The ministry of skill development and entrepreneurship had launched the NAPS in 2016 to promote apprenticeship training. Under the scheme, the Centre provided financial incentives to the establishments for engaging apprentices by sharing stipend support and the basic training cost.
As of January 30, 2.1 million youth had been enrolled as apprentices since the inception of the scheme.