Aadhaar-based payment of subsidies to khadi artisans has reduced the number of "ghost accounts" and saved the government over Rs 1.5 billion, the Khadi and Village Industries Commission (KVIC) has said.

After implementation of the Aadhar-seeded payment of the Marketing Development Assistance (MDA) or subsidy directly to the bank accounts of the Khadi artisans and craftsmen, the KVIC has so far saved over Rs 1.53 billion worth of public money in the 2015-16 and 2017-18 fiscals, a press note of the commission said.

With the cleansing of the records, nearly 503 institutions have stopped claiming subsidies for non-existent artisans, it said.

"KVIC has entered the new digital era on March 1 this year with the implementation of the Integrated Financial Management System (IFMS)... (it) enables real-time transaction accounting, budgetary control and reconciliation systems, connecting all its field offices," the release quoted Minister of Micro, Small and Medium Enterprises Giriraj Singh as saying.

Pointing to the menace of some khadi institutions claiming subsidy for inflated number of artisans, the KVIC said the government's 'Digital India' initiative has ensured that the correct number of artisans is provided by using their Aadhaar cards.

"In 2015-16, MDA of around Rs 316 crore (3.16 billion) was claimed and given to 1,918 Khadi institutions. After the implementation of online Direct Benefit Transfer (DBT) system through Aadhar-seeded bank accounts in January 2016, the MDA amount was reduced to Rs 172 crore (1.72 billion) for 1,759 institutions in the next fiscal 2016-17. In the present fiscal 2017-18, the KVIC has disbursed Rs 163 crore (1.63 billion) among 1,413 institutions," it said.

KVIC Chairman V K Saxena said verification of artisans was carried out by officers of various ranks, including CVO, directors and members and they had found that many khadi institutions were claiming subsidy even for non-existing artisans, thereby usurping the money over the last 10 years.

"This meticulous exercise has weeded out almost 7 lakh (700,000) fake artisans as the number of registered number of artisans was found 4.6 lakh (460,000) instead of inflated 11.6 lakh (116,000), thereby reducing the subsidy burden on the government worth Rs 152 crore (1.523 billion).

"Not only that, the number of KIs, who claimed subsidy (MDA) has also come down to 1423 in current FY till March 13, 2018 from 1759 in FY 2016-17 and 1918 in 2015-16," he said.

Saxena said there was a need to cleanse the data and remove numbers of the non-existing artisans so that the MDA could directly be paid to the artisans in their accounts.

"We introduced online DBT system through Aadhar-seeded bank accounts in January 2016, which resulted in flushing out of 'ghost' artisans who were usurping government subsidy," he said.

Now "we have the real and genuine artisans and they are registered with us on online portal. This Swachchata Abhiyaan has led to creation of genuine data of artisans as well as the Khadi institutions, an exercise not attempted earlier," he added.

MDA is calculated at 30 per cent of the prime cost of production. Out of this eligible amount, 40 percent is paid to the khadi-producing institutions, 40 percent to the artisans and 20 percent to the same institutions for giving discounts to customers.