In the quest to leg up India's digital economy, Prime Minister Narendra Modi will be launching Aadhaar Pay, a digital payment platform on April 14th— the birth anniversary of Dr Bhimrao Ramji Ambedkar.
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What is Aadhaar Pay?
Aadhaar Pay is a biometric-based digital payment system, which aims at making banking transactions easy and accessible to all people, particularly the non-literate. Any Aadhaar-linked account holder will now be able to perform all the transactions, just with thumb impression or the 'angootha chap'.
How does it work?
As this provision is for people who have linked their bank accounts to their Aadhaar, one has to punch in their Aadhaar number and then give their thumb impression, which then acts as a password. A customer can now make payments even if one does not have a smartphone.
According to the Finance Ministry directive, public sector banks (PSBs) have to adopt Aadhaar Pay by April 14.
The bigger challenge would be for the state-run banks who will have to convince as many buyers and sellers as possible to adopt the Aadhaar Pay. According to Money Control reports, the government is expecting 5 lakh merchants to get on board for the success of this new payment system.
In order to make merchants adopt the Aadhaar Pay, PSBs have been advised to make sure that the rental charges to set up a Point of Sale terminal does not exceed INR 100 per month for small merchants.
Last year, Modi had started the Bharat Interface for Money (BHIM) app, which facilitates e-payments directly through banks.
