India's PAHAL paid LPG subsidies into bank accounts instead of onto cylinder prices

India's subsidized cooking-gas program was leaking: cylinders meant for households were diverted to commercial use, and duplicate or ghost connections multiplied because the subsidy lived in the price. In November 2014 the government relaunched PAHAL — Pratyaksh Hanstantrit Labh — in 54 districts, then nationwide on 1 January 2015.

Under PAHAL, consumers buy cylinders at market price and the subsidy is credited directly to their bank account, after linking either Aadhaar or a bank account to their 17-digit LPG ID. A one-time advance of Rs.568 is paid on first booking so the market-price purchase never leaves a household short.

The design turned every consumer into a check on the system: because subsidy flows only after a real purchase by a registered household, fake connections stop being profitable. The launch release emphasized that the benefit meant for the genuine domestic customer reaches them directly and is not diverted.

At launch the scheme covered over 15.3 crore consumers across 676 districts, with more than 6.5 crore (43%) already enrolled and receiving cash in their bank accounts; SMS updates and cash memos kept the process transparent.