After being stagnant for almost six months last year, the Aadhaar enabled payment system (AePS) has witnessed a rise in transactions volume in July.
As per latest data shared by the National Payments Corporation of India (NPCI), AePS recorded close to 206 million transactions in July, which is 11.35% more than what it did in June 185 million.
Notably, in the second half of last year, AePS almost had suffered no growth as the Supreme Court in a verdict had scrapped the mandatory linking of Aadhaar number with bank accounts.
Later in October, UIDAI asked banks to continue with AEPS facility uninterrupted as this mode of withdrawal is a part of the direct benefit transfer (DBT) scheme where the use of Aadhaar is permissible.
In April 2017, the PM had launched the facility to fast-track financial inclusion.
AePS allows non-smartphone users to perform basic banking transactions like cash deposit, cash withdrawal, intrabank or interbank fund transfer, balance enquiry and obtaining a mini statement through biometric authentication at micro-ATMs.
Though, it has also faced challenges in interchange for off-us transactions, where a customer uses another bank infrastructure and transactions failures. Banks are said to be posing as one of the roadblocks in creating conducive infrastructure for AePS.
As per industry observers and Nandan Nilekani committee, the Aadhaar based payment system can be instrumental in turning rural population digital with faster adoption but there is a lot to be done.
