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Friday Fact – Standardization can help you save billions

  • By faber
  • August 23, 2019

Did you know, the government of India has saved ₹ 90,000 crores with the help of Aadhar card scheme?

Aadhar card is a card that has a 12-digit unique number issued by the Unique Identification Authority via details of a person’s biometric such as iris scan and fingerprints along with the demographic information like date of birth and address.

Aadhar card scheme was launched in India in the year 2009. With the help of Aadhar, India set out to be the first country to give a unique identity to every citizen. The key reason to establish this was to use this number for all the interactions with the state which would thus help the government eliminate fraud, make taxation more efficient, and ultimately save money.

The vision seen in 2009, has finally shown results. When calculated in 2018, the government said that the Aadhar is the game changer and has helped them in saving around ₹ 90,000 crores by eliminating duplicates, non-existents and fake beneficiaries.

India with the help of Aadhar can save up to ₹ 77,000 crores – estimated by the digital dividend report of the World bank.

Until 2018, in the last 28 months over 1.22 billion Aadhaar numbers have been issued. Nearly 99% of the adult population of India who is above the age of 18 stands covered with Aadhar. 2,579 crore authentications have been undertaken till 2018 and every day, 27 crore authentications are said to be completed.

Under the direct benefit transfer scheme, till 15 December 2018, 635.2 million bank accounts had been linked with the unique identity number. The overall number of subsidy transactions through Aadhaar is almost around 425 crores. The overall amount of subsidy transferred through Aadhaar has now equaled ₹ 169,868 crores. This unique technology is only implemented in India. And to your surprise, the government has also transferred $12 billion electronically into the bank accounts in real-time to the world’s largest cash transfer system.

In the new era of the data economy, identity authentication, paperless transactions, frictionless payments, these are all very important layers and that is what India has adopted. India is the world’s only country where a billion people can do completely cashless and paperless transactions on their mobile phones using this infrastructure which has dramatically reduced costs.

Hence, as you can see, the Indian government has standardized its process by linking all its government schemes, various financial services, bank accounts and documents to Aadhar. By doing this, the government has been able to remove all the non-value adding activities and standardizing processes which ultimately leads to identify fraud accounts enrolled under governments scheme and eliminating them. The cost which was prior used to provide the unknown fake accounts has been eliminated and by standardizing the process the government has removed all the non-value adding activities thus saving time, energy and money. Ultimately the government has saved ₹ 90,000 crores and used it in more productive ways at efficient places?

So, as you can see, standardization can help eliminate the non-value adding activities which can thus lead to saving a huge amount. So, have you started implementing standardization in your organization?

Written and Compiled by Faber Priyal & Faber Mayuri