Your 12-digit Aadhaar number could soon become your single point payment address.If the plans of the upcoming payment bank by IndiaPost are to go by, over 112 crore Indians who have an Aadhaar number till now will be able to transact - send and receive money - only on the basis of the Aadhaar number irrespective of the fact whether it is linked to a bank account or not.
IndiaPost CEO AP Singh told ET that currently Aadhaar is not a payment address in itself since it is dependent on the bank account, but the payment bank, which plans to start operations from September this year, will change that.
The proposal may also help the bank scale up quickly as almost 98% of the country's population already has an Aadhaar number, which is far lesser than the number of people under the current banking net.
“We will be bringing out a solution to make Aadhaar a payment address with or without a bank account. That means that crores of people who have an Aadhaar should be able to receive payment from any source,“ he said.
Singh, who was part of the founding team of Aadhaar as the deputy director general of Unique Identification Authority of India (UIDAI) said that the team worked very hard to make Aadhaar a payment address, which means that anyone could be able to receive money against an Aadhaar number whether they have a bank account linked or not.
Currently around 40 crore bank accounts in the country are linked with Aadhaar and around 2 crore people are linking their accounts with the unique number every month.
UIDAI had also run a pilot with five banks including the State Bank of India to test the model. Singh said that the pilot was entirely successful, but as things progressed, the pilot was not taken forward by banks since payments are not their business.
“So Aadhaar hasn't really become a payment address,“ he said. The bank, which hopes that by September it will start operations in at least 650 districts of the country, aims to “Simplify and universalise“ payments systems and will differentiate itself from the others on this basis.
Singh said that since 1950, every Western Europe post office ran a service, under which if you had a saving bank account service with the post office, it provided you with a service where you could just pick up your phone and call a four digit number and pay for utilities or any other registered payment service.
Under the service one could just give commands such as 'please pay my electricity bill' and it would be done. “I would like to like to believe that given the state of broadband etc. in the country and the people's lack of comfort with some of the mobile applications. That's the kind of thing we will be working on which will be simplified payments,“ said Singh.
He had told ET earlier in an interview that the bank's approach will be “bottoms-up“ and it will target around 500 million people who have feature phones and around 350 million who are below that who are without any phone at all.
“Something that others are not doing but might emerge as our USP is door-to-door banking with the help of the postman. Plus simplified payment solutions for the masses is what we will be targeting,“ he said.
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