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Aadhaar Pay Merchant App for Cashless Transactions (SBI)

Aadhaar Pay Merchant App for Cashless Transactions (SBI)

Aadhaar Card quickly gained traction after its launch and soon became a unique proof of identity for every Indian citizen. The core idea behind the Aadhaar system was to eliminate the need of carrying multiple documents to establish proof of identity and proof of address. Also, this system gave the Union Government a central database of every Indian’s identity. So, it should not be a surprise that now, Aadhaar Card is used for everything – from bank accounts to pension accounts, from railway ticket booking to mobile SIM purchase. The government is pushing Aadhaar in every sphere and especially, in government schemes and services. The latest addition was Aadhaar-enabled payment system or app designed specifically for merchants so that the government can push for less cash and eventually cashless economy. Airing government’s vision and of course, for grabbing more market share, SBI is all set to launch its own Aadhaar Payment app.

Aadhaar Pay Merchant App for Cashless Transactions

What is Aadhaar Payment System/App?

Aadhaar payment system is a mobile app. It is basically for the merchants who will receive the payment. The app is not for the customers or buyers. It is more like a point of sale machine that needs to be installed by the merchants to receive the payment through debit/credit cards.

The merchants have to install the app on their Smartphones. On the other, if the payer or the buyer does not have any phone, he/she can still pay through the same. Customers who are paying require Aadhaar Card number and a bank account.

How does Aadhaar Payment App work?

  • As said, it is for the merchants, the traders have to install the app on their Smartphones. Once the app is installed the merchants will be required to register by providing their nature of a business and other details.
  • After finishing the registration process and verification, merchants can use the app. But before that, they have to connect a fingerprint scanner with their phone. As it only works with the payers’ fingerprints, the scanner is a must. The merchants can use an online scanner as well.
  • For the payers, they will have to provide their unique Aadhaar Card number to the merchant. After entering the number, payers or customers need to provide their fingerprints. This is mandatory as it works like a password.
  • As soon as Aadhaar number and fingerprint are being provided, the app will display a list of bank accounts. Such a list will show up only and only if that Aadhaar number is linked with multiple bank accounts. If customers have only one Aadhaar linked bank account then the app will show only that single bank account that is linked with Aadhaar.
  • A merchant will have to select appropriate bank account as indicated by a customer. As soon as a bank account is selected, the app will debit the money from the account (which is essentially a customer’s bank account) and will credit the debited amount to the merchant’s bank account to conclude the payment.
  • Interestingly, the Aadhaar Payment System completely eliminates the need for carrying a phone or debit cards or credit cards for the customers. Customers themselves (the whole humans) become a walking and talking bank. All that the customers need to have are two things – their fingers and their Aadhaar number. However, the merchant has to have Smartphone and the App to receive the payment.

How to get the Aadhaar Payment App?

The app is available on Google Play Store. It is launched on Android Platform only. As of now, no news of launching it on windows or iOS has come from the authority. People with Android Smartphone will be able to download the app from Google store.

  • In the Google store, search for Aadhaar Payment app. Once you get it, accept all the terms and conditions required for downloading. You also need to grant a set of permissions for the app to download and install on your phone. Once you grant the necessary permissions, the app will automatically download and install.
  • After finishing the installation, proceed with the further steps shown in the app. You will need a biometric machine too. Buy a biometric machine and install it in your store, shop or office. Biometric machines are easily available online and you will have to shell out up to rupees 2,000 or slightly more for the same.
  • After downloading the app, there will be an option namely ‘download payment application’. You have to tap there and enter the details about the biometric machine you bought. This step is needed to link the machine with the app.
  • After feeding the information, you need to provide your bank details. There will be a small verification process and then you are done with the integration of the biometric machine with your Android app.

For Customers: How to use it?

Customers have to enter their unique Aadhaar number into the payment app installed on a merchant’s smartphone. Once the Aadhaar is entered, the app will show the bank options. After selecting the bank, which the payer wants to use for payments, he/she needs to scan his or her fingerprint. As mentioned, this fingerprint will work as a password and once it is verified by the machine; the payment process will be successfully completed.

Need of AadhaarPaymnet App:

It is true that India is inching towards the digitization with each passing day. People are using more online transaction and plastic money compared to cash. But the fact is, it is happening mostly in urban and semi-urban areas. Rural areas or remote rural areas are still accustomed with cash-based transactions as many of them are unaware of the digital process or perhaps, they don’t have access to such hardware. As said earlier that this Aadhaar payment system does not need any Smartphone, it will be pretty helpful for the rural people. Many of the rural citizens still don’t have mobile phones. So, it is natural that they will not be able to use digital payments. This payment method will, however, allow them to go cashless!

Benefits of Aadhaar Payment App

  • There are several apps out there to boost digital transactions. UPI-enabled apps (BHIM launched by Government of India is one such example) and mobile wallets (like Paytm, MobiKwik etc.) However, they all require people (consumers) to carry smartphones. Not everyone has a smartphone. Some people don’t have phones at all. Aadhaar Payment app overcomes this problem as consumers don’t need to carry smartphones or even have any phone!
  • Because Aadhaar Payment App links directly with both merchant’s bank account and customers’ bank accounts, the changes of fraud get eliminated. Because banks carry out KYC verification of customers and also link their bank accounts with Aadhaar, it becomes easy for banks to identify frauds and criminals.
  • With Aadhaar Payment App, merchants can ditch the service fee they need to pay for using POS machines. This increases the profits for the merchants.
  • For customers, Aadhaar Payment App eliminates the need for carrying any plastic money or cash.

Problems of Aadhaar payment app

  • There are two problems that merchants can face while using the app. First of all, the app runs with the help of internet and hence, low coverage area or weak connection can stop the app to from working anytime. If the device i.e. the phone gets damaged, the payment process can be stopped then and there.
  • Secondly, the merchant has to buy and install a biometric machine. This definitely bears the extra cost for the merchants. Fortunately, customers or payers don’t have to bear any cost to use this app.

SBI’s Aadhaar Pay Merchant App

SBI doesn’t like its customers to drift away and use any other service. This is evident from the fact that SBI has launched its very own Aadhaar Pay Merchant app to create a closed ecosystem where the bank itself provides all gateways for receiving and paying.

The Aadhaar Pay Merchant App of SBI works using the same principle that has been described above. The only difference this app has with GOIs Aadhaar Payment App is that it is owned by SBI! Of course, SBI’s app has a differently designed app interface and a set of different screens that users (merchants) will see.

SBI’s Aadhaar Pay Merchant App requires the following:

  • Merchant’s mobile phone should be running on Android OS.
  • The OS version should be at least 4.2 (Jelly Bean).
  • The mobile phone should have OTG (on-the-go) support so that the fingerprint scanner can work.
  • The merchant should have a fingerprint scanner that has STQC certification (a complete list of devices that are compatible with SBI’s app has been provided by the bank).
  • The mobile should have a data connection.

Interestingly…

SBI’s Aadhaar Pay Merchant App has an option for two types of merchants – retail merchant and corporate merchant. Merchants need to install the app and register and have their biometric device registered with the app.

Other Wallet versus Aadhaar Payment App

There are a number of mobile wallets these days that people use to pay for anything they buy. Apart from private wallets such as Mobikwik, Paytm and others, there are such mobile wallets launched by banks as well that allow consumers to carry out a host of payments like bill payments, mobile recharge, ticket booking etc.

There is a difference between all these wallets and Aadhaar app. All these wallets require mobile app both for the merchants and the customers. However, Aadhaar Payment App requires only the merchants to have the app installed. The problem with mobile wallets is that people need to link their bank accounts with their apps and then add money to the wallet to pay. Aadhaar Payment App eliminates the extra step of adding money to app account. The money transaction takes place directly through bank accounts.

For consumers’ aspect, the only downside of Aadhaar Payment App is that they need to have Aadhaar-linked bank accounts else, they cannot use this app for paying to the merchants.

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