The public distribution system (PDS) is one of the important social welfare schemes in India. However, the PDS has been criticised an account of its delivery system, corruption, leakages, increasing uphold expenditure, etc. In response to these criticisms, the Union Government has come out with a Direct Benefit Transfer (DBT) Scheme as an alternative to PDS. This study has investigated whether the shift from PDS to DBT is sensitive to the food security concerns of the country. The study is based on primary data collected from 400 households in 10 village panchayats of Puducherry. The study has found that PDS has been functioning well in the Union Territory of Puducherry and card holders received 10 kg of rice every month. The assessment of preference for DBT and PDS revealed that they were not against cash transfers but wanted food on a regular basis as provided by PDF. Therefore, success of DBT significantly depends upon the extent of financial literacy, financial inclusion and physical accessibility of food grains. According to the study both PDS and DBT are functioning well in the Union Territory of Puducherry. [ABSTRACT FROM AUTHOR] Copyright of Agricultural Economics Research Review is the property of Agricultural Economics Research Review and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)