Digital is not the cup of tea for workers of Assam, Bengal gardens

Over five years have passed since demonetisation, yet cash is still the king in majority of the tea gardens in northern India (which includes tea estates in Assam and West Bengal). A majority of the 10-lakh-odd workers employed at these estates continue to collect their wages in cash as lack of proper infrastructure and poor connectivity make digital payments challenging.

Vivek Goenka, Chairman, Indian Tea Association, said most of these workers have bank accounts and hence depositing or transferring funds into them is not an issue. However, withdrawal becomes a challenge due to the lack of adequate number of ATMs and CSPs (Customer Service Point) in and around the garden areas.

“While all estates have taken initiatives to open bank accounts, only around 5-10 per cent of the tea gardens are able to disburse payments digitally due to infrastructural bottlenecks,” Goenka told BusinessLine.

In fact, the issue was also highlighted at a recent interactive session with the Union Commerce and Industry Minister, Piyush Goyal, organised by a city-based chamber of commerce. The minister immediately got into a call with the SBI Chairman and said the bank has given its assurance to set up ATMs and micro ATMs wherever feasible.

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The issue assumed urgency arising out of the insertion of Section 194 N of the Income Tax Act, 1961, which states that a levy of 2 per cent TDS will be applicable on cash payment in excess of ₹1 crore in aggregate during a financial year effective September 1, 2019.

Key challenges

The Union Labour Ministry had, in February 2017, notified the amendment of the Payment of Wages (Amendment) Act, 2017. This led to the amendment by the respective State governments of Assam and West Bengal that mandated every person employed should have their due wages credited in the bank accounts of the respective employee.

Subsequently, meetings were held with the respective State governments in the presence of lead bank representatives. However, these did not yield the desired objective, primarily because of the remoteness of the tea estates; difficulty in installing adequate number of ATMs and connectivity posing a major challenge for digital payments. This apart, the number of CSPs provided by the bank was noted to be insufficient as they have constraints of limited funds at their disposal, PK Bhattacharjee, secretary general of the Tea Association of India (TAI), said.

The association therefore, submitted a comprehensive list of existing and required ATMs and CSPs in all of its member gardens of Assam, Cachar and North Bengal to SLBC and to the Union Finance Minister.

“Pursuant to the meeting, progress has been made in installation of ATMs, CSPs and BCs in the tea estates of both Assam and West Bengal. Installations of CSPs through third party vendor (authorised National Corporate BC) have also been initiated in many gardens. However, one of the major drawbacks found was the linking of Aadhaar numbers with respective bank accounts of the employees,” Bhattacharjee said.

Connectivity issue

Moreover, connectivity still poses a major challenge and a number of gardens have reported instances of halting/disruption of transfer of money to workmen.

“Tea industry, being a labour intensive one, and failure on part of the industry to transmit salary/wages to workmen on the designated day, may cause immense industrial relation problem in the gardens which leads to law and order problem,” he pointed out.

According to industry insiders, there is also some resistance from workers, who are unwilling to accept digital payments since they have become used to the age-old practise of receiving wages in cash.

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