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Indian Digitalization Payment Reforms

by orbinside

Digitalization of Indian Payment and Its way of Transacting

We will be discussing Indian Digitalization Payment Reforms in this article. India being pushed towards adopting digitalization of financial transactions for past 10 years. Government of India aims to be less dependent upon printed currency. Demonetization has been a key driver to the digitalization push. Citizen use digital ways of transactions with no option left over since demonetization.

Reserve Bank of India has taken a major initiative to develop Indigenous AEPS – Aadhaar Enabled Payment System, BharatQR, BHIM, BHIM Aadhaar Pay, FastTag, UPI 123Pay through NPCL – National Payment Corporation Limited.

Government of India has pushed digitalization through NPCI – National Payment Corporation of India:

  • AEPS – Aadhaar Enabled Payment System
  • BharatQR
  • BHIM – Bharat Interface for Money
  • BHIM Aadhaar Pay
  • FASTag
  • UPI 123Pay

AEPS – Aadhaar Enabled Payment System 

APES is bank-led model where business correspondent of any bank allows basic transaction through Aadhaar Authentication using network of POS (Micro ATMs).  


BharatQR is a common QR code developed by NPCI in collaboration with American Express, Mastercard, Visa for the ease of payment and interoperability.  


BHIM – Bharat Interface for Money 

NPCI – National Payment Corporation of India developed BHIM mobile application, based on the UPI-Unified Payment Interface. It uses IMPS over UPI to transact between bank.


BHIM Aadhaar Pay 

BHIM Aadhaar Pay is an Aadhaar based payment interface which allows real time payments to merchants using Customer Aadhaar number and authenticating them through their biometrics. 


BBPS – Bharat Bill Payment System 

NPCI Bharat Billpay Limited (NBBL), a subsidiary of NPCI, National Payment Corporation of India under Government of India developed BBPS, a Bill Payment System. Customers can pay their utility bills through this interoperable bill payment service. It has onboarded all bill payment aggregators in India. 



FASTag, is a device containing Radio Frequency Identification (RFID) technology for making toll payments directly. It is affixed on windscreen of the vehicle and enables customer to make toll payments directly from the account linked to the device. The latest can also be used to buy fuel as well. 


UPI 123Pay 

UPI 123Pay is 3 step method to initiate UPI payments over feature phone without internet access or USSD Channel, It uses IVR-Interactive Voice Response technology specially in rural areas. 


*99# USSD  

*99# USSD is an USSD channel service which uses quick code for performing UPI transactions and does not require smartphone and internet access.


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