Cash transfer schemes being implemented for women across several Indian states are putting a heavy strain on state finances, according to a recent study by PRS Legislative Research. These Unconditional Cash Transfer (UCT) programs, which were limited to only two states three years ago, have now expanded to 12 states nationwide. The report reveals that these states have allocated a massive ₹1.68 lakh crore in their current budgets solely for these schemes.

PRS warns that the rapid expansion of such large-scale welfare programs is beginning to hurt fiscal stability. Among the 12 states implementing these schemes, six states have already recorded revenue deficits in the current financial year. Notably, even states that previously enjoyed revenue surpluses are now slipping into deficit due to the enormous financial burden of these cash transfer programs.

The report highlights growing concerns among financial experts, who fear that while the schemes are politically popular and beneficial for women, their long-term economic consequences could be severe. Continuous spending on large-scale free cash transfers, without corresponding revenue growth, could undermine fiscal discipline and push states toward deeper financial crises in the coming years.