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With BHIM integration, your Aadhaar card could soon be a universal payment ID

Indian Business Blog featuring on Business, Technology and Education
Written by Harshad Patankar

Cashless transactions are booming up in India, this could be the effect of the demonetization and also various other initives of the government to promote cashless transactions; like 14444 toll free number or proposing Cash Tax etc. NITI Aayog is also making steps to rank various states based on the number of digital transactions happened in the states.

BHIM and Aadhar Based Payment

Now your Aadhaar card could soon become a universal payment ID. In a few weeks, the government will unveil a feature for payments through the Bharat Interface for Money (BHIM) app by simply entering the 12-digit Aadhaar number. Transactions where Aadhaar is listed as a payment ID on the BHIM app will not require any biometric authentication or prior registration with the bank or Unified Payment Interface (UPI). This will make it more mainstream since almost one-third of India already has Aadhaar numbers, which have been linked to their bank accounts, as system is available to disburse the gas subsidy directly into bank account.  UIDAI is currently working with banks and the National Payments Corporation of India (NPCI) and expects to roll out the feature in the “next few weeks.”

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Currently, there are five payment options on the BHIM app – namely mobile number, bank account or IFSC code, among others. Aadhaar number will be the sixth such option, and it will be unvailed when the strengthening security is achieved.

Payment to Mobile Number with BHIM

Though BHIM allows sending money to a mobile number, it requires the receiver to be registered with the UPI in order to accept payment. In turn, the long process of generating a UPI PIN by entering debit card details may discourage the poor and the illiterate.

“Through Aadhaar, any person – large service providers or independent ones such as plumbers or carpenters, irrespective of whether they are on BHIM or not – can get payments for their services directly into their bank accounts if it is linked to Aadhaar,” said Pandey.

He added that almost two crore people are linking with accounts with Aadhaar every month and total figure for such accounts should go up to 50-60 crore – half the country – in the next two to three months. Making Aadhaar a payment address is only part of the plan. It will also be possible to key in the Aadhaar number at a point-of-sale device and authenticate using biometrics.

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About the author

Harshad Patankar

My name is Harshad Patankar and I am the chief blogger at BumbleBeeHub Blog and where I like to share my internet/tech experience along with some fascinating updates around the Business, Technology, Education and Government sectos with my online readers on this website. You can read more about me at my About Page. You can follow me on Twitter, Facebook & Google