It is an Aadhaar based banking solution enabling you to operate Aadhaar linked bank accounts and carry out transactions using nothing but Aadhaar number and authentication through fingerprints.
It provides interoperability between customers and bank at point of sale (PoS) – for example a grocery shop- and ensures financial inclusion to the technologically marginalized sections of society (This includes not only rural but also urban population, the elderly, and generally less tech savvy population).
How does Aadhar Enabled Payment System (AEPS) work?
You need to provide your Aadhaar number at point of sale through a business correspondent (approved bank agent providing basic banking services) of any bank (microATM), which is verified through fingerprints stored in the Aadhaar database. Below are the basic steps to conduct a banking transaction.
Step 1- You enter your Aadhaar number in microATM
Step 2- You choose the transaction type (withdrawal/deposit or fund transfer)
Step 3- Enter the name of your bank
Step 4- Scan you fingerprint/eye for biometric authentication
For deposits the you will be given a receipt of transaction by the correspondent. For fund transfer you will have to provide the beneficiaries Aadhaar no.
What do you need to start using Aadhar Enabled Payment System (AEPS)?
Below are the prerequisites to start using AEPS.
- Bank account (the bank should be a part of AEPS network).
- IIN (Identifying the Bank to which the customer is associated). You can find the list of banks that are a part of the AEPS network and their IIN later in the post.
- Aadhaar number which is seeded in the bank account.
The Aadhaar number and IIN can either be entered manually or by swiping RuPay ATM & microATM card (presently only issued by Bank of India, others bank are in the process of issuing these cards).
What services are provided/ transactions can be done using AEPS?
The four main Aadhaar enabled banking transactions are as follows:-
- Balance Enquiry
- Cash Withdrawal
- Cash Deposit
- Aadhaar to Aadhaar Funds Transfer
The following table details the steps required to conduct the transactions
| Sr no | Transaction Type | Inputs Required |
|---|---|---|
| 1. | Balance Enquiry | Customer’s Details: a. Aadhaar Number b. Bank’s IIN c. Fingerprint |
| 2. | Cash Withdrawal | Customer’s Details: a. Aadhaar Number b. Bank’s IIN c. Amount to be Withdrawn d. Fingerprint |
| 3. | Cash Deposit | Customer’s Details: a. Aadhaar Number b. Bank’s IIN c. Amount to be Deposited d. Fingerprint |
| 4. | Fund Transfer | Remitter’s Details: a. Aadhaar Number b. Bank’s IIN c. Amount to be Transferred d. Fingerprint Data Beneficiary’s Details: |
- Mini statement
- Mobile update ( in UIDAI database)
- Opening a new bank account through e-KYC
- It allows interoperability between Aadhaar enabled accounts of even different banks.
- It is promoting financial inclusion.
- At present it is providing only basic banking facilities but the ultimate objective is to provide full range of banking service through Aadhaar enabled transactions in a secured and safe manner.
A business correspondent can be an individual, a shopkeeper, post office, NGO, cooperative societies etc. who have been authorized to be so.
| S.No | Bank name | IIN code |
|---|---|---|
| 1. | Bank Of India | 508505 |
| 2. | Corporation Bank | 508507 |
| 3. | Syndicate Bank | 508508 |
| 4. | Union Bank of India | 508500 |
| 5. | The Federal Bank Limited | 508523 |
| 6. | Dhanlaxmi Bank LTD | 508528 |
| 7. | Axis Bank | 508533 |
| 8. | ICICI Bank | 508534 |
| 9. | Allahabad Bank | 508540 |
| 10. | Indian Overseas Bank | 508541 |
| 11. | The Lakshmi Vilas Bank Ltd | 508542 |
| 12. | Central Bank of India | 508546 |
| 13. | Dena Bank | 508547 |
| 14. | State Bank of India | 508548 |