What Is AEPS? Aadhaar Enabled Payment System Explained

How do you make payments to others? Well, most of the time, people either go for direct cash payments, via bank, or online payments like IMPS, NEFT, or RTGS. While this is true, there has been a new mode of payment, which is now known as the AEPS transaction. 

It is nothing but the use of your Aadhar card to make the payments. While this might look like a bit of a surprise, this is one of the most secure ways of payment currently.

So, what is AEPS? How does the Aadhaar Enabled Payment System (AEPS) work? Well, if you are also looking for an answer to all these, then this is the guide you need. Check all the details and understand what it is and why it is important now.

What Is Aadhaar Enabled Payment System?

The Aadhaar Enabled Payment System is a banking facility. It allows you to access your bank account, either savings or current, using your Aadhaar number and fingerprint authentication. It is designed to support basic banking needs. The best part is that you can do all the transactions easily without the need for a debit card, PIN, or mobile app.

AEPS is mainly used through micro ATMs. These are operated by banking correspondents and retail agents. With the AEPS service system, a user can perform the basic transactions like:

• Withdraw cash

• Check their account balance

• Transfer money easily

This is one of the reasons why this is not just important but also a key solution to financial inclusion, especially in rural and semi-urban areas.

Key Features of Aadhaar-Enabled Payment System

The Aadhaar Enabled Payment System focuses on making banking simple, secure, and accessible for everyone. It allows users to carry out basic financial transactions with ease. Some of the key features of the same are as follows:

• Enables banking using Aadhaar number and fingerprint authentication.

• Works without debit cards, PINs, or smartphones.

• Supports cash withdrawal, balance enquiry, and fund transfer.

• Available through banking correspondents and micro ATMs.

• Linked directly to the user’s Aadhaar-seeded bank account.

How to Register for the Aadhaar Enabled Payment System?

Registering for the Aadhaar Enabled Payment System is quite simple. It is a process that starts with your Aadhaar card and bank account. Then, you just need to follow some simple steps, and your work will be done.

So, the steps involved in the AEPS registration are as follows:

Step 1: Visit your bank branch or an authorized banking correspondent. Ensure that you carry your bank details and Aadhar card with you.

Step 2: Request the Aadhaar seeding for your bank account. You need to do this if the seeding is not already done. You need to check the NPCI Aadhar linking here.

Step 3: If there is a form, then fill it. Submit the same with the required documents. Please double-check all the details. 

Step 4: Complete biometric verification using your fingerprint.

Step 5: After successful verification, your AEPS registration is activated. Now, you can use it for your transactions easily.

Core Services Offered Under the Aadhaar Enabled Payment System

The Aadhaar Enabled Payment System offers a set of basic banking services. These are the ones that help the users with easy financial access as needed. Since these services are received from the micro ATMS, the key services that you can gain are as follows:

• Cash Withdrawal: Withdraw money from your Aadhaar-linked bank account using fingerprint authentication.

• Balance Enquiry: Check your bank account balance instantly without a passbook or ATM.

• Cash Deposit: Deposit cash into your Aadhaar-linked bank account through authorized agents.

• Fund Transfer: Transfer money from one Aadhaar-linked account to another.

• Mini Statement: Allows you to check all the recent transactions that you have made.

How Does AEPS Cash Withdrawal Work?

AEPS cash withdrawal allows you to withdraw money from your bank account. You can do this with the help of just your Aadhaar number and fingerprint. The process is simple. There is no need for a debit card and PIN. The steps are as follows:

Step 1: Go to your bank or nearest AEPS service point. Ensure that you carry your Aadhar card with you.

Step 2: Start by sharing your Aadhaar number. Once done, you will now need to select your bank name.

Step 3: Choose the cash withdrawal option on the micro ATM.

Step 4: Enter the amount that you are willing to withdraw.

Step 5: Authenticate the transaction using your fingerprint.

Step 6: Once verified, you will get the amount. The same will be debited from your account.

Pros and Cons of Aadhaar Enabled Payment System

The Aadhaar Enabled Payment System is definitely known for its ease. It has helped various people to enjoy access to banking services in a way that has never been imagined. This is a key step towards financial inclusion at a broader level. But just like any other service, there are pros and cons to it that you must know.

Pros

• Makes banking accessible without debit cards or smartphones.

• Uses biometric authentication, which reduces the risk of PIN misuse.

• Helps promote financial inclusion in rural and remote areas.

• Allows quick cash withdrawals and balance checks.

Cons

• Biometric failures can occur due to fingerprint issues.

• High dependence on the internet is bad.

• Limited to basic banking services only.

• Requires Aadhaar to be linked with the bank account.

Conclusion

The Aadhaar Enabled Payment System has made everyday banking simpler and more accessible. This is more effective for the people who have limited or no access to the traditional banking channels. All you need is your Aadhaar and biometric authentication. AEPS allows users to withdraw cash, check balances, and transfer funds without cards or apps. This saves time and ensures that you have access to the banking system as needed.

But if you are looking for more details and guidance, you need to have an expert by your side. This is where registering on Rupeezy can help you a great deal. Get all the insights and information you need to not manage but build wealth over time. 

FAQs

What is AEPS used for?

AEPS is used for basic banking services. Some of the key services that you can get using the AEPS are cash withdrawal, balance enquiry, and fund transfer using Aadhaar.

Is AEPS safe to use?

Yes, AEPS is perfectly safe to use. It is one of the services that uses biometric authentication linked directly to your Aadhaar-seeded bank account.

Can AEPS be used without a debit card?

Yes, AEPS works without a debit card, PIN, or mobile banking application.

Is there any charge for AEPS transactions?

Some service providers may charge a small fee for AEPS transactions, depending on the bank or agent.

Who can use the Aadhaar Enabled Payment System?

Anyone with an Aadhaar-linked bank account and registered biometric details can use AEPS services.