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Aadhaar Enabled Payment Systems

The UIDAI to enable more financial inclusion with Aadhar card has allowed Aadhaar Enabled Bank Account (AEBA) holders from marginalized sections of the society to have access with the banking system.

The UIDAI, which acts as a centralized authority for aadhar has joined hands with Reserve Bank of India (RBI) and National Payments Corporation of India (NPCI) to develop a platform mainly focused towards the marginalized section to secure access to banking via micro ATMs by using Aadhaar authentication.

What is AePS?

The term AePS which stands for Aadhaar Enabled Payments Systems which aims to facilitate the financial inclusion via Micro ATMs or Point of Services which will be set up through the business correspondent of any bank using the Aadhar based authentication. The AePS allows an individual to carry on six types of transactions.

Under this AePS, customers are required to provide the following inputs to carry on transactions:

  • Aadhaar Number
  • Identifying the Bank to which the customer is associated (IIN)
  • Fingerprint captured during their enrollments

Services offered by AePS

The following are the list of services provided by AePS:

  • Balance Inquiry
  • Cash Withdrawal
  • Mini Statement
  • Cash Depository
  • Best Finger Detection
  • Aadhar to Aadhaar Fund Transfer

Objectives of AePS

The following are the main objectives of AePS

  • To enable banks in India to route the aadhar initiated inter-bank transactions via a central switching and clearing agency.
  • To build a strong foundation for a full range of Aadhar enabled banking services.
  • To facilitate inter-operability across the banks through a safe and secure manner.
  • To build a strong foundation for a full range of Aadhar enabled banking services.
  • To subserve the RBI’s goal in electronification of retail payments.
  • To facilitate the government of India’s entitlements like Social Security Pension, Handicapped Old Age Pension Schemes, NREGA and so on of both the Central and State government entities via aadhar and authentication thereof as supported by the UIDAI.
  • To Sub – Serve the goal of the government of India and the country’s Central Bank (RBI) in encouraging financial inclusion.

How Does AePS Work?

Step 1: To begin with, the customer will have to give his/her aadhar number details, fingerprint data and financial transaction via a micro ATMs

Step 2: Proceeding further the digital data, which will be in an encrypted form will be sent to the UIDAI through a ‘Bank Switch’

Step 3: The data will be verified and authenticated by the UIDAI and the result of the same will be reflected either with a YES/NO as a response.

Step 4: If the response is “YES”, then the bank will initiate the required authorization.

How to Use AePS?

It is very easy to use AePS. One has to follow the below-mentioned steps

  • First, visit the nearest bank in your area irrespective of if you hold an account in the bank or not.
  • Enter your 12 digits unique Aadhaar number in the PoS Machine
  • Select the type of transaction (cash deposit, mini statement, withdrawal, balance enquiry, fund transfer or eKYC).
  • Now proceed further and select the name of the bank.
  • Enter the amount of transaction.
  • Authenticate your transaction by giving your biometric details (either iris scan or fingerprint)
  • The transaction will get completed in a few seconds.
  • Now collect the receipt from the bank correspondent. 

Points to Remember while using the AePS

  • If in case, you have more than one account in one bank, then the primary account will only be used under the AePS.
  • The AePS supports those transactions between Aadhaar linked bank accounts only.
  • It is mandatory to link bank account with Aadhaar if you wish to avail the services of AePS.
  • There is no need for PIN or OTP for making transactions through AePS
  • The cutover of transactions done through AePS takes place at 11 pm every day. If any transaction has been done
  • before this time during the day, they all will be included in the statement.
  • Multiple bank accounts can be linked with Aadhaar to avail the AePS facility. However, only one account per bank can be used to use this facility.

AePS Fund Transfer Limit

Currently, the country’s Central Bank, the Reserve Bank of India has set no limit for transactions made using AePS. But, some banks in India have capped the transactions when made using the AePS platform with the sole reason to mitigate the misuse of payment system mechanism. Some banks have set a daily limit of a maximum of Rs 50,000 on the total transactions made using the AePS.

Why did the Government of India launch AePS?

The government of India has set a target of bringing in all the citizens in the banking framework. However, it is not a feasible idea to open bank branches in all the remote villages. Thus, the government of India has come up with the idea of AePS wherein individuals from far off places can easily access the banking system as they will be able to send or receive money and avail all kinds of financial and non – financial banking facilities by using micro ATMs and banking correspondents.

The advantage of using AePS is all the transactions will require the biometric authentication which is either the use of fingerprint scan or iris scan for verification. Signatures of individuals can be forged but one cannot forge either the iris scan or fingerprints and this has made the transactions safer. People need not have to carry their passbook or debit card for fund transfer purpose all they need is the unique Aadhaar number and the fingerprints with which transactions can be made easily without facing any hindrances.


Q: What can I do if some of the authentication transaction records indicate failure?

ANS: For all failed authentication transaction records, a defined error code is assigned. Check the details of the error code number displayed against the failed transaction to identify the exact reason for the failure.

Q: What to do? When some of the transactions I saw in the records weren't done by me?

ANS: You should contact the respective AUA or Authentication User Agency for more information if the registered authentication transaction is not performed.

Q: What does AUA transaction ID mean in authentication records?

ANS: For all authentication transactions performed by you, Authentication User Agency -AUA creates a unique transaction ID to recognize the transaction and send it to UIDAI as part of the authentication. This transaction ID along with the response code can be used by you for any further investigation by AUA.

Q: What is Auth Modality?

ANS: Auth Modality means authentication modality, The UIDAI provides authentication functionality with various modes such as a demographic, biometric, or one-time password or OTP. The authentication modality tells us the authentication mode that was used to perform this defined authentication transaction.

Q: Will submitting an Aadhaar update application promise updating data?

ANS: Submission of information or data for updates or correction does not promise an update of Aadhaar data. All submitted data will be verified and validated, after which only the same will be updated.

Q: How will I be able to submit the supporting documents for the Self-Service Update Portal?

ANS: If you are using the online Self-Service Update Portal update process, you will need to upload a scanned copy of the original documents.

Q: If I go to a permanent Aadhaar enrollment centre for updates, what details can I update?

If you go to a permanent enrollment centre, you can update both demographic and biometric details.

Q: Will my Aadhaar card number change after it is updated?

ANS: No, your Aadhaar card number will remain unchanged even after the update.

Q: Can I update my mobile number online?

ANS: No, you cannot update your mobile number online. You must go to the nearest permanent registration centre for this purpose.

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