January 30, 2023
Shreeja Ray

Aadhaar Enabled Payment System (AEPS): Banking Made Easy

Aadhaar cardholders can make banking transactions via the AePS, or Aadhaar enabled payment system. It is a project that gives all social groups more power by enabling them to use their Aadhaar cards for banking transactions. The owner of an Aadhaar card needs present biometric data at PoS or micro ATMs in order to complete the transaction. The bank account associated with the Aadhaar card will be used for the transaction.

What is AePS?

AePS, or Aadhaar-enabled Payment System, is its full name. The National Payments Corporation of India developed it. Users only need to provide their biometric data and an Aadhaar number to use the AePS service to conduct transactions on a micro-ATM. The specifics of AePS are as follows:

1. AePS is a system that enables Aadhaar card holders to conduct transactions through a bank account that is connected to their Aadhaar in a manner similar to that of a debit or credit card transaction.

2. Aadhaar authentication is used at Points of Sale (PoS) or micro ATMs to complete the transaction by entering the Aadhaar card number and biometric information.

3. Iris or fingerprint scans can be used as the biometric data.

4. To complete the purchase, users are not required to enter their bank account information.

5. Users can transfer money between bank accounts using AePS, which is safe and secure because it requires users to provide their fingerprints in order to complete the transaction.

What are the Benefits of AePS?

All societal segments can benefit from AePS, or the Aadhaar-enabled payment system, in the following ways:

1. Easy to use Aadhaar enabled payment system

2. It requires the entry of biometric information in addition to the Aadhaar card number.

3. It gives the disadvantaged group in society more power.

4. To complete the purchase, users are not required to enter their bank information.

5. The implementation of Aadhaar authentication makes it possible for consumers to access their bank accounts with ease.

6. Given that one must provide biometric information and an Aadhaar number, AePS is absolutely secure.

7. Micro PoS devices can be transported to far-off villages to make it simple for customers to conduct transactions there.

How to use the AePS facility?

AePS allows Aadhaar card holders with linked bank accounts to conduct transactions swiftly and easily. He or she only needs to adhere to the guidelines:

1. Visit your neighborhood banking correspondent

2. in the PoS machine, enter your Aadhaar number.

3. Choose the transaction type and type the name of the bank.

4. To finish the transaction, enter the transaction amount.

5. After that, submit your biometric data to verify the payment.

6. Once the transaction has been completed, a receipt will be given.

How Does AePS Work?

 Simply keeping in mind your 12-digit Aadhaar number will allow you to access necessary banking services. Your bank account is connected to your Aadhaar number. You must use your fingerprint, which is authenticated with your Aadhaar, in order to authenticate a transaction or access an AePS feature. After the UIDAI authenticates your fingerprint, the bank will only proceed with processing your transaction. Let's say a man introduces himself as Anvay and displays the Aadhaar number linked to Anvay's name. Anvay is looking to do a transaction in order to pay for his purchases from a seller. So, in order to confirm the transaction, he must present his fingerprint; if they match, the bank will carry with the transaction.

As a result, there are frequently many facilitators working together such as:

1. Whoever wants to carry out the transaction.

2. The middleman (merchants/store owners) or banking associate you want to use to carry out the transaction

3. The bank has Aadhaar support.

4. UIDAI, to authenticate a fingerprint.

5. For transaction settlement, NPCI.


How frequently may we take money out of AePS?

There are no set restrictions on AePS transactions. To stop system abuse, several banks have set a daily transaction cap of Rs. 50,000.

What purpose did the Aadhaar-enabled payment system serve?

The Aadhaar-enabled payment system's goal was to use bank correspondents or micro ATMs to reach every area of the nation without bank branches. It was designed to make it simple for consumers to transact by requiring only their Aadhaar number and biometric information.

What services does AePS provide?

The AePS services offered to Aadhaar card holders include cash withdrawals, cash deposits, AePS balance inquiries, intra- and interbank financial transfers, and more.


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