Securing ₹5 billion in the first tranche, Delhi joins the PM e-Bus Sewa Payment Security Scheme, ensuring timely electric bus payments amid growing demand for green transport.
Delhi has been included in the PM e-Bus Sewa Payment Security Mechanism (PSM) Scheme. The inclusion follows the onboarding of 15 other Indian states and marks a crucial step toward ensuring timely payments to e-bus manufacturers and operators nationwide.
The PSM Scheme, which is part of the ₹34.3533 billion initiative launched by the Centre, aims to provide payment security to electric bus bidders, original equipment manufacturers, and operators in the event of defaults by public transport authorities (PTAs). The first tranche of ₹5 billion has already been released to kick-start the fund, which will be used to ensure the continuity of payments in the event of financial delays.
The scheme, launched by the Ministry of Heavy Industries in October 2024, aims to accelerate the deployment of 38,000 electric buses in India. Delhi, which has been allocated 2800 e-buses under the PM Electric Drive Revolution (PM E-Drive) scheme, faced delays due to the requirement for a direct debit mechanism (DDM) to ensure timely payments.
However, the Delhi government has now successfully completed the necessary process and registered the DDM with the Reserve Bank of India (RBI) in January 2026, resolving the earlier bottleneck.
The PSM Scheme is designed to provide assurance to bidders that, even if PTAs face financial challenges, payments to e-bus manufacturers and operators will proceed smoothly. The funds will be replenished by the state government upon payment.
According to a Mint report, the industry welcomed the development, noting that the scheme provides assurance for future bidding on central contracts, ensures timely payments, and shifts credit risk from state transport units to Convergence Energy Services Ltd (CESL), the government agency overseeing electric bus demand aggregation.
