Aadhaar Enabled Payment System-AePS

[AePS] What is the Aadhaar Enabled Payment System, and how does it work?

What is the Aadhaar Enabled Payment System?

Aadhaar Enabled Payment System (AePS) – Aadhaar Enabled Payment System- AEPS is a system developed by the National Payment Corporation of India (NPCI), through which people can perform financial transactions (Balance Enquiry, Cash Deposit, Cash Withdrawal, Remittance) with the help of Micro ATM by using only their Aadhaar number with the help of fingerprint verification. That is, it is a system that allows financial transactions by doing Aadhaar verification through fingerprints.

Under the Aadhar Enabled Payment System, people need not provide their bank account details to make financial transactions. Using the Aadhar Enabled Payment System, any person can transfer funds from one bank to another using an Aadhar Number. Through this system, a person can send money from his account to any account, whether his account is with the sending bank or not. Because this system works on a centralized server

Under the Aadhaar enabled payment system, fingerprints are required instead of the back details of the account holder to authorize financial transactions, which ensures security in financial transactions. That is, this system is a secure system for financial transactions.

What is Aadhaar Enabled Payment System Fund Transfer Limit?

Reserve Bank of India is yet to set any limit for making transfers through Aadhaar based payment system. In contrast, various banks have set a maximum daily limit of ₹50000 for financial transactions done through AEPS to reduce the misuse of the payment system.   

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Which services can be availed through Aadhaar Enabled Payment System?

The following services can be availed through Aadhaar based payment system-

  • Cash withdrawal of money.
  • Cash deposit.
  • To find out the balance in the bank account.
  • Transfer money from one aadhar number to another aadhaar number. (B2C & G2C Transactions)
  • To get a mini statement of a bank account.
  • E -KYC – Best Finger Detection / Irish Detection
  •  BHIM Aadhaar Pay
  •  Authentication
  •  Tokenization
  •  Aadhar Seeding Status

Benefits of Aadhaar Enabled Payment System

There are many benefits of Aadhaar Enabled Payment System, some of which are as follows-

  • Banking and non-banking financial transactions can be done through a banking/business correspondent.
  • In this system, the customer must not furnish bank account details/card details for financial transactions.
  • Correspondents of one bank can transact with other banks and other banks under Aadhaar Enabled Payment System.
  • This payment system makes financial transactions secure due to biometric verification.
  • Financial transactions can be made readily available in remote villages/areas through micro POS machines using Aadhaar based payment systems.
  • Using the AePS Financial Transaction System can reduce the workload of banks and save time and money for the people.
  • Through this system, account holders of all banks can access their banks through Aadhaar authentication.
  • The customer does not need to stand in long lines at banks or ATMs.
  • The Central and State Government bodies use Aadhaar Enabled Payment System Aadhaar based authentication in schemes like NREGA, Social Security Pension, Disabled Pension, Old Age Pension, etc.

How to use the Aadhaar Enabled Payment System?

Using the Aadhaar Enabled Payment System is quite simple. To make financial transactions through this system, follow the steps given below-

  • First of all, go to the nearest business/banking Correspondent in your area.
  • The Banking Correspondent of the bank in which you have your bank account doesn’t need to be the same. You can make financial transactions through any banking correspondent through Aadhaar Enabled Payment System.
  • Enter your 12 digit Aadhaar number in the PoS (Point of Sale) machine provided by the Banking Correspondent.
  • Select any mode of the transaction from Cash Deposit, Withdrawal, Fund Transfer, Mini Statement, Balance Inquiry or e-KYC, etc.
  • Select the name of the bank in which you have a bank account from the list provided.
  • Enter the amount for the transaction at your convenience.
  • Authenticate the transaction process using biometric parameters like fingerprint or iris scan etc.
  • Once the biometric verification is done, financial transactions will be completed in a few seconds.
  • A receipt relating to the financial transaction will be provided to you by the banking correspondent.
  • Thus one can complete financial transactions using the Aadhaar enabled financial system just through Aadhaar number and fingerprint.

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How does AEPS work?

Aadhar Enabled Financial System Machine (AePS Machine) works like a Point of Sale Machine (PoS Machine). This financial transaction system requires the customer to enter the Aadhaar number instead of the debit/credit card PIN and scan the biometric data (fingerprint or retina of the eye) to authenticate the payment process. The Bank’s Issuer Identification Number (IIN) or name, Aadhaar number, and fingerprint are required to process financial transactions through AEPS. Nitesh

Things to keep in mind while transacting with Aadhaar Enabled Financial System?

While doing financial transactions through Aadhaar enabled financial system, it is necessary to keep in mind the following things to avoid any fraud-

  • Your Aadhaar number is required to be linked with the bank account before doing financial transactions through this system.
  • If you have more than one account with the bank, only the primary account will be used for financial transactions.
  • There is no need for any One Time Password and PIN for transacting through the Aadhaar Education Financial System.
  • AePS only accepts financial transactions of bank accounts linked with the Aadhaar number.
  • Multiple banks can be linked with Aadhaar to get the benefit of Aadhaar enabled financial systems.
  • But only one account from one bank can be used to avail financial transactions through this system.
  • The cutover of all financial transactions done through this system takes place every day at 11 PM. All payments made during the day are included in this settlement.

Why has the Government of India launched AePS?

The Government of India has set a target to bring all the country’s citizens under the banking structure. For the fulfillment of which it is not possible to open bank branches in all the remote villages, the Government of India has come up with the Aadhaar Enabled Payment System. Using this system, every citizen who lives in remote areas can easily send/receive money with the help of micro ATMs and banking correspondents and avail of other financial and non-financial banking facilities.

The second main objective behind the introduction of Aadhaar enabled financial systems is to curb frauds increasing day by day. The Aadhaar enabled financial system is a secure mode of financial transactions compared to other financial transaction systems, as it is verified through biometrics. A bank passbook or debit card is not required to make payment through this system; only Aadhaar number and fingerprints are required. Due to this, it is easy for everyone to use this service.

FAQs Related to Aadhaar Enabled Payment System

Q-1. Is it safe to do financial transactions through AePS?

Yes, the Aadhaar Enabled Payment System is a secure system developed by the National Payment Corporation of India as payment is authenticated by biometric verification through fingerprints / Irish scans. It isn’t easy to forge fingerprints / Irish. The AePS financial transaction system is secure.

Q-2. Who can use AePS?

The Aadhaar Enabled Payment System can be used by any Indian citizen holding an Aadhaar card. But it is necessary for the user that his Aadhar card is linked with the bank account.

Q-3. What type of account does the consumer need to have to use AePS?

To use the Aadhaar enabled payment system, the user needs to have a bank account linked to the Aadhaar card. The bank you have your account with should be a member/sub-member of NFS Network and should have an AePS facility provided by the National Payment Corporation of India.

Q-4. What is Bhim Aadhar Pay?

Bhim Aadhar Pay is a system that allows merchants to receive digital payments from customers through Aadhaar based authentication. Consumers can receive payment through any of the authorizing banks with the BHIM Aadhaar Pay service. For which the merchant must have a certified biometric scanner and Android mobile with the BHIM Aadhar app.

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