According to the government officials, nearly 40 crore Aadhaar numbers have been linked to the bank accounts.
To use this service, the customer has to first link his/her bank account to the Aadhaar number.
A shopkeeper must download the Aadhaar Pay App on a smartphone, and that should be connected to a biometric device or finger scanner. The Prime Minister, Narendra Modi introduced BHIM App for digital payments and now the IDFC bank launched Aadhaar Pay App to make payments much easier.
India may give banks an incentive of up to Rs 10 for each transaction to encourage merchants to adopt digital modes of payment, helping achieve the objective of a less-cash economy that makes tax evasion easier to detect. Customers can pay the merchant by selecting the bank's name and filling only the Aadhaar number. The customer's fingerprint is then used to authenticate the transaction. "Basic banking services will come to those who even do not have basic mobile phones", he said. The Bank is targeting a reach of 50,000-75,000 merchants in the next two years. A bank employee will be sent to the merchant to help him/her with the use of the application.
Meanwhile, since past year, IDFC Bank had been silently carrying on tests and experiments across 16 states, for implementing Aadhaar Pay platform, and by launching their apps yesterday, they became first Indian bank to do so.
IDFC has said in the press release that 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.
The application was developed by IDFC Bank under the guidance of the Ministry of IT, NITI Aayog, Unique Identification Authority of India (UIDAI) and National Payments Corporation of India (NPCI). "IDFC Aadhaar Pay will accelerate the pace of growth for cashless payments, giving wings to the government's efforts towards digitisation for inclusive growth".
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