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All Authorised Payment Systems and Instruments Permitted For Linking With Fastags

The National Payments Corporation of India (NPCI) had developed the National Electronic Toll Collection (NETC) program to meet the electronic tolling requirements of the Indian market, offering an interoperable nationwide toll payment solution including clearing house services for settlement and dispute management. In this light, FASTag is a device that employs Radio Frequency Identification (RFID) technology for making toll payments directly while the vehicle is in motion. FASTag (RFID Tag) is affixed on the windscreen of the vehicle and enables a customer to make the toll payments directly from the account which is linked to FASTag. It offers the convenience of cashless payment along with benefits like – savings on fuel and time as the customer does not has to stop at the toll plaza

Till now only a limited payment options were available to the customers, but from now onwards the Reserve Bank of India (RBI) via Circular dated 30 December 2019 has allowed for all authorised payment systems and instruments [non-bank PPIs, cards and Unified Payments Interface (UPI)]. These payment instruments will now be available for linking with the FASTags, which can be used for various types of payments (vehicle toll, parking fee, etc.). The Turn Around Time (TAT) for resolving failed transactions advised vide circular entitled, Harmonisation of Turn Around Time (TAT) and customer compensation for failed transactions using authorised Payment Systems, dated September 20, 2019, shall also be applicable to the transactions carried out in the NETC system. The circular prescribes the framework on Turn Around Time (TAT) for resolution of customer complaints and compensation framework across all authorised payment systems.

Further, the transactions in the NETC system can be performed without any Additional Factor of Authentication (AFA) and / or pre-transaction notification / alert. Moreover, NPCI shall facilitate requests received from banks / non-banks in this regard.

Text of the Relevant RBI Circular dated 30th December 2019 is as follows:-

Reserve Bank of India

RBI/2019-20/126
DPSS.CO.PD No.1227/02.31.001/2019-20

December 30, 2019

The Chairman / Managing Director / Chief Executive Officer
Members of National Electronic Toll Collection (NETC) System /
Authorised Payment System Participants / Operators

Madam / Dear Sir,

Enhancing facilitation of National Electronic Toll Collection (NETC) system

India is progressing ahead with NETC gaining large scale acceptance. Currently, the NETC system allows linking of FASTags with bank accounts – savings, current and prepaid.

2. In order to further broad base this system by allowing more payment choices for the customers, as well as for fostering competition among the system participants, all authorised payment systems and instruments [non-bank PPIs, cards and Unified Payments Interface (UPI)] shall from now be permitted for linking with the FASTags, which can be used for various types of payments (vehicle toll, parking fee, etc.).

3. The Turn Around Time (TAT) for resolving failed transactions advised vide circular DPSS.CO.PD No.629/02.01.014/2019-20 dated September 20, 2019 shall also be applicable to the transactions carried out in the NETC system.

4. The transactions in the NETC system can be performed without any Additional Factor of Authentication (AFA) and / or pre-transaction notification / alert.

5. NPCI shall facilitate requests received from banks / non-banks in this regard.

6. This directive is issued under Section 10 (2) read with Section 18 of the Payment and Settlement Systems Act, 2007 (Act 51 of 2007).

Yours faithfully,

(P. Vasudevan)
Chief General Manager

Author Bio

Qualification: Student - CA/CS/CMA
Company: National Law University Odisha
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