UPSC Prelims 2015 CSAT Paper II · Q26 of 74 Comprehension medium

Passage

Passage – 6 Vast numbers of Indian citizens without bank accounts live in rural areas, are financially and functionally illiterate, and have little experience with technology. A research study was conducted in a particular area in which electronic wage payments in Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) are meant to go directly to the poor. It was observed that recipients often assume that the village leader needs to mediate the process, as was the case under the previous paper-based system. Among households under this research study area who claimed to have at least one bank account, over a third reported still receiving MGNREGS wages in cash directly from a village leader.

What is the most logical, rational and crucial message that is implied in the above passage ?

  1. (a) MGNREGS should be extended only to those who have a bank account.
  2. (b) The paper-based system of payments is more efficient than electronic payment in the present scenario.
  3. (c) The goal of electronic wage payments was not to eliminate mediation by village leaders.
  4. (d) It is essential to provide financial literacy to the rural poor. ✓ UPSC's answer

Why the answer is (d)

• The passage highlights that a vast number of rural citizens are financially and functionally illiterate with little technology experience.

• It notes that despite the shift to electronic wage payments, over a third of households with bank accounts still receive cash via village leaders.

• This persistence of the old mediation system is attributed to the recipients' lack of understanding of the new electronic process.

• Therefore, the crucial implication is that without addressing the root cause of financial illiteracy, the intended direct benefit transfer cannot be achieved.

• Hence, providing financial literacy to the rural poor is the most logical and essential step to ensure the success of electronic payments.

Why the other options are wrong

(a) MGNREGS should be extended only to those who have a bank account.
The passage does not suggest restricting MGNREGS eligibility to bank account holders, but rather addresses the implementation gap due to illiteracy.
(b) The paper-based system of payments is more efficient than electronic payment in the…
The passage implies the electronic system is the intended improvement, not that the paper-based system is more efficient; the issue is user capability, not system design.
(c) The goal of electronic wage payments was not to eliminate mediation by village leaders.
The goal of electronic payments is to eliminate mediation, but the passage implies this goal is failing due to lack of financial literacy, not that the goal itself was different.

Asked in the CSAT Paper II of the UPSC Civil Services Preliminary Examination 2015, held on 23 August 2015. Question and answer key: Union Public Service Commission. Explanation: UPSC Answer Check.

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