IDFC Bank, one of the youngest in India, has become the first to launch an Aadhaar-based cashless payment system. The Android app launched by the IDFC bank which is only to be carried by the shopkeeper and the only Aadhaar number need to carry by the consumer to the bank.
The fingerprint scanner costs about Rs 2,000 for the merchant.
Up to now, one billion Aadhaar numbers have made and 400 million are linked to their respective bank accounts. Finance Minister Arun Jaitley had announced in the Union Budget that 20 lakh Aadhaar Pay Point of Sale (PoS) machines will be deployed by banks in the current financial year.
The service is going live just as Samsung launches its mPayment service in the country, suggesting that the latter and similar platforms like Apple Pay could face a particularly challenging market in India. In the pilot phase, spanning three months, over 1500 merchants have enabled digital transactions for customers of all banks, using IDFC Aadhaar Pay on their smartphones.
Merchants must download the app and connect to a biometric reader.
We will keep you updated as more details come in regarding the Aadhaar Pay regime, and how other banks are going to implement the same.
Speaking on the launch, Dr. Rajiv Lall, Founder MD & CEO, IDFC Bank, said, "IDFC Aadhaar Pay proves that technology can revolutionise last mile payments". The customer's fingerprint is used to authenticate the transaction. "IDFC Aadhaar Pay will accelerate the pace of growth for cashless payments, giving wings to the government's efforts towards digitisation for inclusive growth".
The app has been designed by IDFC Bank in association with the Unique Identification Authority of India (UIDAI) and National Payments Corporation of India (NPCI). Niti Aayog CEO Amitabh Kant urged other banks also to adopt the new system.