Aadhaar Pay was expected to be released by end of December, 2016. Though the cashless system is a little late on reaching the masses. It is now being cited that ‘Aadhaar Pay for merchants’ is finally going to be introduced in the next few days.
The service will initially commence with four banks including State Bank of India (SBI), Syndicate Bank, IDFC bank and IndusInd bank. The information was offered by senior government officials to Economic Times, who further stated that Bank of Baroda and Punjab National Bank might also join the league.
Commenting on the integration of Aadhaar Pay, Rajiv Lall, Founder MD & CEO, IDFC Bank said,
It is, thus far, the simplest way to pay as it does not require a customer to swipe debit cards, remember passwords, or download apps. Importantly, there are no transaction fees for both merchants and customers. IDFC Aadhaar Pay will accelerate the pace of growth for cashless payments, giving wings to the government’s efforts towards digitisation for inclusive growth.
Finance Minister, Mr. Arun Jaitley announced the launch of the already speculated, Aadhaar Pay while delivering the Budget FY 2017. The payment solution instead of requiring a plastic card or an e-wallet algorithm will function on 12-digit unique identification (UID) number printed on your Aadhaar Card. This system will further push the country towards a digitised and cashless economy.
The cause of delay seems to be the lack of exact specifications. The government has been busy categorizing the right kind of registered devices to be allowed to accept payments. Such specifications, however, have now been sorted and the government is soon expected to publicly detail it out. The government officials further reasons out that the delay was to ensure that the system is as secure as possible. Security issues need to be cross-checked again and again as it would be the very first time a unified biometric system will be released for the Indian masses.
Using Aadhaar Pay, a consumer will authenticate the transaction through a fingerprint scanner at the point of sale. The fingerprint will be matched to your Aadhaar Card’s data of prints and you will be verified. There are no additional authentication mechanisms involved to execute the transaction. The payment will be processed through the Aadhaar card linked bank account. To channelize the system in business, a merchant will have to spare about Rs 2,000, (initial cost for the Finger Print Scanner) and link the reader to a smartphone application.
People concerned about biometric security issues may need to know that the database for UIDAI Aadhaar project has multiple layers of security. It is very difficult for hackers to cross through that data and access the print, as said by experts involved in this project.
In addition, our Finance Minister also mentioned that the Government is targeting as many as 2,500 crore digital transactions in 2017 alone, with more aggressive goals set for the next year.