All You Have to know About Aadhaar Enabled Payment System
From time to time, the Government of India introduces various facilities that aims at making financial transactions simpler and easier. In order to bring in financial inclusion in the country, the Reserve Bank of India constituted two Working Groups. While one Working Group focused on MicroATM standards, the other worked on Central Infrastructure & Connectivity for Aadhaar based financial inclusion. Both the groups submitted a report to the Reserve Bank of India and Aadhaar Enabled Payment System was soon introduced.
What is Aadhaar Enabled Payment System?
Aadhaar Enabled Payment System is a bank-led model that facilitates online financial inclusion transactions where a Business correspondent of any bank can perform a transaction at at PoS (MicroATM) using the Aadhaar authentication. There are six important types of transactions that can be carried using the Aadhaar Enabled Payment System are:
- Withdraw cash
- Cash deposit
- Balance enquiry
- Best Finger Detection
- Get a mini statement
- Aadhaar to Aadhaar Fund Transfer
A user would need the IIN ((Identifying the Bank to which the customer is associated), fingerprint given during the enrolment, and the Aadhaar number.
Objectives of Aadhaar Enabled Payment System
- To help and empower users to use their Aadhaar number and their Aadhaar enabled bank account to perform financial transactions like deposit cash, withdraw cash, print a mini statement, or check the balance.
- To build the foundation and promote Aadhaar enabled Banking services.
- To make retail payments electronic.
- To enable all Aadhaar Enabled payments through a trustable central switching and clearing agency.
- To help the Government of India (GoI) and Reserve Bank of India (RBI) to achieve the goal of financial inclusion.
BHIM Aadhaar Pay
Merchants can now receive payments digitally from their customers using the BHIM Aadhaar Pay. Under BHIM Aadhaar Pay customers can make a payment over the counter through Aadhaar authentication. Any merchant associated with an acquiring bank on the BBHIM Aadhaar Pay network can accept payment can accept payment from a customer of any bank.
The merchant can do so by authenticating the customer’s biometrics (which is for now only fingerprints) and receive payments from the customer’s Aadhaar enabled bank account instantly. The merchant must have an Android mobile with the BHIM Aadhaar app to perform this activity.