On March 1, 2000, the Planning Commission identified 6.52 crore BPL(Below poverty line) families, including 2.43 crore Antyodaya Anna Yojana families, at the 1993-94 poverty line threshold, for the Central Government's Targeted Public Distribution Scheme. However, in 2009, the number of BBL ration cards was issued by the State Government and Union Territories was 10.96 crore. By linking ration cards with Aadhaar cards, 5.8 crore fake ration cards have been eliminated and 20.4 crore BBL ration cards are in regular use. Earlier, prior to the digitisation, many problems with the PDS ration system exist, there are millions of ineligible and fraudulent ration cards; at the same time, millions of poor families have no ration card. PDS shop owners in collusion with government officials diverted the subsidized food supply and petroleum to the
black market. Card numbers are inflated by those held under false or duplicate names, in the names of dead or fake people . Following initiatives have been taken to weed out the fake ration card and to prevent fraud.
Aadhaar-enabled beneficiary The bank accounts and ration cards of eligible beneficiaries are linked to their
Aadhaar numbers. A bank account can be enabled as AeBA by seeding (linking) it with an Aadhaar number. Seeding makes mapping information stored on the
NPCI payment gateway that facilitates the subsidy payment. Seeding helps identify genuine and eligible beneficiaries and prevents duplicate and non-existent persons from registering. Users can link a bank account as self-service option through
ATM kiosks, the Internet, bank websites, telephone, or by providing a copy of the Aadhaar letter to a bank. Prior to Aadhaar, the issues plaguing and derailing social security programs in India were caused by corrupt officials and middlemen manipulating paper records and stand-alone databases of social security services. Due to lack of a unique identifier like Aadhaar, stand-alone databases cannot detect and eliminate duplicate or fraudulent beneficiaries. The most common
modus operandi adopted to inflate the beneficiary list is by inserting duplicate entries, non-existent names, and the names of dead and non-eligible people. Attempts are then made to steal the social security benefits money, depriving genuine claimants.
Aadhaar-enabled DBT Aadhaar-enabled service delivery (AeSD) prevents corruption in retail by
directly crediting benefit money into the beneficiary's bank account; this is called Direct Benefit Transfer (DBT). It eliminates middlemen and fraudulent, ineligible beneficiaries. In this way, Aadhaar saves billions of rupees of public money annually and enables poor people access to social security benefits. Various financial and other services are being Aadhaar-enabled, called Aadhaar-enabled Service Delivery (AeSD), in a phased manner. By 1 January 2014, half of India (289 districts across various states) had been covered by DBT for subsidized LPG. By August 2013, 6.3 million duplicate LPG connections were detected by Aadhaar and were cancelled. The national government saved $1 billion on reduced imports by mid-2013.
Aadhaar-enabled eligibility check Applicant eligibility is checked by comparing the service delivery database with other databases. For example, PDS kerosene eligibility is checked by comparing the PDS database with the LPG database. The subsidy on kerosene allocation is reduced if the LPG subsidy is detected for that household. Ration card eligibility is cross-checked with other related, Aadhaar-linked databases. This approach is designed to improve the
audit trail, add efficiency and prevent corruption. It results in direct benefit access for eligible people and annually saves billions of rupees from corruption. Tangible benefits became visible from 2014; a report by
UBS published in January 2014 showed Aadhaar DBT can save 1.2% of GDP. The finance minister informed the Parliament during Vote on Account that as of 31 January 2014, under DBT ₹33 billion for 21 million LPG subsidy and ₹6.28 billion (628 crores) have been transferred for various social programs in 5.4 million transactions.
e-Ration Card Services With the help of e-Ration service, applicants can obtain ration cards and check their costs and food grain availability online. This will help end the corrupt practice of holding back rations and ensure cards reach the needy. Aadhaar card holders can apply for e-ration cards. The
Department of Food Supplies and Consumer Affairs website provides eligibility details for the food security plan. This service was first introduced in Delhi. Later this has been followed by the state Governments of Tamil Nadu, Kerala ==Impact of AADHAR based technology in fraud prevention ==