The Centre is all set to launch an ‘Aadhaar Payment App’ that would do away with plastic cards and the point of sale machines.
As per a report in Economic Times, the app would make digital payments affordable and help customers and merchants alike. The app has been developed by IDFC Bank along with UIDAI and National Payments Corporation of India.
It will help in doing away with fee payments to Visa or MasterCard, which are service providers of these cards. As of now, the adoption of card payments is also very slow due to 2-3 per cent charge levied by merchants and 2 per cent charge levied by card companies.
The app will also help merchants in remote villages to make the transition to digital payments.
The Aadhaar Payment app uses consumer’s Aadhaar card details and their linked bank account details, along with their biometric scans to authenticate transactions. Since the smartphone will be connected to a biometric reader the transaction will be authenticated through biometric scan, which will serve as the password.
The app will help bridging the gap that exists due to huge scarcity of point of sale terminals. There are only 15 lakh point of sale terminals and their acceptance has been slow. Out of these, SBI alone has deployed 3 lakh, followed by HDFC and ICICI banks.
The government is now working alongside payments and regulator companies so that the aim of country-wide digital transactions can be made possible.
The central government is extensively urging citizens to adopt digital technology after Prime Minister Narendra Modi on November 8 demonetised currency notes of Rs 500 and Rs 1,000.
Earlier on December 15, the NITI Ayog announced daily, weekly and mega awards up to Rs 1 crore for consumers and merchants who take to digital payments.