Of late, you might have come across people talking of Aadhaar ATMs, micro ATMs and such other terminologies as Aadhaar Enabled Payment System (AePS), Aadhaar Payment, and so on. The surprise could further be compounded by the fact that most of these people are not exactly the ones you would probably consider as tech-savvy. Many of them are actually village residents who barely have any exposure to technology, the kind of which people in the city are exposed to! Right?
Well, AePS, Aadhaar ATM, Aadhaar Payment are among the several methods of digital transaction processes that allows a bank customer to access banking transactions at certain designated micro ATM or mATM outlets with just his/her Aadhaar authentication. These micro ATM outlets are also known as Aadhaar ATMs.
So, how does the system work? In the usual banking system, you would either initiate a transaction, such as cash withdrawal, money transfer to another account, or, check the balance available in your account either at an ATM kiosk or by visiting the bank branch during the bank working hours. In addition, you could also make the transactions on a computer over the bank’s website or on the bank’s app on your mobile phone. Let us leave the last two options aside for the time being.
Now, how does AePS work? You can go to any Aadhaar ATM and transact using only your 12-digit Aadhaar number and fingerprint as identity proof. These micro ATMs are card swipe devices similar to Point of Sale (PoS) credit/debit card swipe machines, but work like a regular bank ATM and allow for regular ATM services such as cash withdrawal and balance enquiry. Now, the mATM points operated by iServeU will also offer mini statement services, too.
You can also make inter-bank transfers at these Aadhaar ATMs. Known as Aadhaar payment, these will, however, require you to have a bank identification number for inter-bank transactions.
The Aadhaar mATM service is a card-less and PIN-less banking service. The payments done by Aadhaar ATMs are done by the respective banks, but the finger authentication is done by UIDAI, the nodal agency for Aadhaar in India.
AePS and mATMs have changed the face of banking in rural India where the reach of bank branches or regular ATMs is very less. Aadhaar ATMs have brought millions of Indians into the fold of the regular banking system as part of the government’s overall aim of financial inclusion for all Indians. With AePS, it has also been possible for the government to extend its monetary and financial benefits to the farthest corners and the most marginalised in society. The financial benefits are directly deposited in the beneficiaries’ accounts who can avail themselves of the benefits by a simple withdrawal at an Aadhaar ATM.