We all know that Aadhaar is a 12-digit identification number issued by the Unique Identification Authority of India. This number serves as a proof of identity and address and is valid all across India. But did you know that your Aadhaar card can be used to make transactions as well?
The Aadhaar enabled payment system (or the AePS) is a payment system that was brought into place to allow people from all walks of life to access banking and financial services. This payment system makes it possible for people to make payments through a unique identification number – UID
- AePS is a payment mechanism that allows you to use your Aadhaar Card as a debit/credit card to make transactions from your Aadhaar-linked bank account
- You are not required to provide your bank account details to complete your Aadhaar enabled payment system transactions
- AePS transactions are secure because you are required to submit your biometrics to complete the transaction
Did You Know
Your Aadhaar number can never start with a 0 or a 1!
What is Aadhaar Enabled Payment System?
Aadhaar enabled payment system (AePS) is a payment method that enables Aadhaar cardholders to make financial transactions. It is a programme that empowers all segments of society by allowing people to conduct banking transactions using their Aadhaar cards.
The Aadhaar card user must present biometric information at PoS or micro ATMs to complete the transaction. The transaction will be completed using the bank account associated with the Aadhaar card.
The Aadhaar-enabled payment system was developed by the National Payments Corporation of India. By merely submitting biometric information and an Aadhaar number, users may utilise the service to conduct transactions on a micro-ATM.
What are the Benefits of Aadhaar Enabled Payment System?
Aadhaar enabled payment system offers the following benefits –
- Aadhaar payment is easy and hassle-free
- It mandates the submission of biometric data and the Aadhaar card number. This is what makes these transactions safe and secure.
- It empowers the underprivileged section of society by allowing them to make bank transactions without the need for debit/credit cards.
- You’re not required to submit your bank details to complete your transactions.
- It enables users to access their bank accounts using Aadhaar authentication.
- Micro PoS Machines can easily be transported to remote areas, making it easier for people in rural areas to make transactions.
Did you Know?
The first Aadhar or UID number was issued on 29 September 2010. It was allotted to a resident of Nandurbar in the state of Maharashtra.
Features of Aadhaar Payment Systems
Here are some of the most essential features of the Aadhaar enabled payment system –
- Transactions can only be made from your Aadhaar linked bank accounts
- An Aadhaar card user may use the method to undertake basic banking operations such as cash deposit, intrabank to interbank fund transfer, cash withdrawal, balance enquiry, and getting a mini bank statement through a banking correspondent
- With Aadhaar enabled payment system, you can initiate a transaction very easily, as all you need for this is your Aadhar number and biometric information
- The disbursements of Government schemes like NREGA, Social Security pension, Handicapped Old Age Pension, and many more are also facilitated by the Aadhaar enabled payment system.
How Exactly Does the Aadhaar Enabled Payment System Work?
The Aadhaar payment bridge system works like a Point of Scale (PoS) machine. Instead of the credit card pin, the customer will have to enter their Aadhaar card number and authenticate the transaction with their biometric data.
You require the following in order to use the Aadhaar pay service –
- Bank’s Issuer Identification Number (INN) or name
- Aadhaar Number
- Biometric data (fingerprint)
How to Use the Aadhaar enabled payment system?
An Aadhaar card holder with a linked bank account can use the Aadhaar enabled Payment Facility to make quick and easy transactions. All they need to do is –
· Visit the local banking correspondent
· Enter your Aadhaar number in the PoS machine
· Enter the bank name and select the type of transaction you wish to make
· Enter the amount
· Provide your biometrics to confirm the payment
· Collect your receipt
Things to Keep in Mind While Using Aadhaar Enabled Payment System
There are a bunch of things that you need to keep in mind to make sure your AePS transactions are safe, secure, and hassle-free.
- Your bank account must be linked to your Aadhaar card to be able to use the Aadhaar enabled payment system.
- A PIN or OTP is required to complete AePS transactions
- Only your primary account would be used to make the transactions if more than one account is linked to your Aadhaar
Word to Remember
Aadhaar payment bridge system – The Aadhaar payment bridge system is a program through which your Aadhaar card can be used to make transactions from your Aadhaar linked bank account.
The Aadhaar enabled payment system is an excellent initiative by the government to help underprivileged sections of the society make digital transactions. This is a great step toward a cashless future and can help take cashless transactions to the remotest rural areas.
Frequently Asked Questions (FAQs)
AePS, or Aadhaar Enabled Payment System, is a simple, secure, and hassle-free payment method. The service is being offered by the National Payments Corporation of India (NPCI) and allows you to use your Aadhaar card to make bank transactions.
Aadhaar is a unique number that is assigned to residents of India by the Unique Identification Authority of India (UIDAI). This number serves as identity proof and address proof all across India.
All Indian residents holding a valid Aadhaar card and a bank account can use this payment service. However, it’s important to make sure that your bank account is linked to your Aadhaar card.
To start using the Aadhaar enabled payment service, you must first link your bank account with your Aadhaar number. Then, you need to contact your bank and let them know that you want to enable AePS on your account.
No, it’s not necessary for the payee or beneficiary to have Aadhaar enabled payment system to receive funds.
Yes, you can link more than one account to your Aadhaar card, but only the primary account will be used to make AePS transactions.
No, it’s important for you to have a valid Aadhaar card to use the Aadhaar enabled payment service.
Your bank account needs to be linked to your Aadhaar card for you to be able to use the Aadhaar enabled payment system.
A business correspondent is an approved bank agent offering micro ATM services to banks.
The IIN is a 6 digit number that helps in the identification process of your bank.