AEPS: Aadhaar Enabled Payment System Explained

In today's digital age, the world is moving towards cashless transactions. With the introduction of various payment systems, including the Aadhaar Enabled Payment System (AEPS), it has become easier to make transactions digitally. In this article, we will explore AEPS, its full form, and how it works in banking.


What is AEPS?

AEPS stands for Aadhaar Enabled Payment System, and it is a digital payment system introduced by the National Payments Corporation of India (NPCI). It allows customers to make transactions through their Aadhaar card, which is linked to their bank account. AEPS is a part of the Digital India initiative and aims to provide financial inclusion to all sections of society.


AEPS Full Form

AEPS stands for Aadhaar Enabled Payment System.


How Does AEPS Work in Banking?

AEPS works by linking the customer's Aadhaar card to their bank account. This process is done by the bank, and the customer has to provide their Aadhaar number and biometric details. Once the Aadhaar number is linked to the bank account, the customer can make transactions through AEPS.


AEPS can be used for various transactions, including balance inquiry, cash deposit, cash withdrawal, and fund transfer. To make a transaction, the customer has to provide their Aadhaar number and biometric details to the merchant or banking correspondent. The merchant or banking correspondent then authenticates the customer's biometric details and initiates the transaction.


Benefits of AEPS

AEPS has various benefits, including:


Financial Inclusion: AEPS aims to provide financial inclusion to all sections of society, including those who do not have access to banks or banking services.

Cashless Transactions: AEPS promotes cashless transactions, reducing the use of physical cash.

Easy to Use: AEPS is easy to use and does not require any additional hardware or software.

Secure: AEPS uses biometric authentication, making it secure and reducing the risk of fraud.

AEPS Cash Withdrawal

AEPS cash withdrawal is a service provided by banks that allows customers to withdraw cash using their Aadhaar card. To withdraw cash, the customer has to provide their Aadhaar number and biometric details to the banking correspondent. The banking correspondent then authenticates the customer's biometric details and initiates the cash withdrawal process.


AEPS vs. Other Payment Systems

AEPS is different from other payment systems like UPI, debit cards, and credit cards. Unlike UPI, AEPS does not require a smartphone or internet connection to make transactions. Unlike debit cards and credit cards, AEPS does not require a physical card to make transactions.


Security Measures in AEPS

AEPS uses various security measures to ensure the safety of transactions. It uses biometric authentication, which makes it difficult for fraudsters to misuse the system. AEPS also has various other security features like OTP (One-Time Password) authentication, encryption, and firewalls.


Future of AEPS

AEPS has a bright future, as it aims to provide financial inclusion to all sections of society. With the increase in digital transactions, AEPS is expected to gain popularity among the masses. The government is also promoting AEPS through various initiatives like the Pradhan Mantri Jan Dhan Yojana (PMJDY).



How to Use AEPS?

To use AEPS, the customer has to follow the following steps:


Visit a banking correspondent or merchant who provides AEPS services.

Provide the Aadhaar number and biometric details to the merchant or banking correspondent.

The merchant or banking correspondent will authenticate the biometric details and initiate the transaction.

It is important to note that the customer must have their Aadhaar number linked to their bank account to use AEPS.



AEPS Charges

AEPS charges vary from bank to bank and depend on the type of transaction. Some banks offer AEPS services free of cost, while others charge a nominal fee. It is advisable to check with the bank before using AEPS services.


Frequently Asked Questions (FAQs)

  • Is it mandatory to have an Aadhaar card to use AEPS?
  • Yes, it is mandatory to have an Aadhaar card linked to the bank account to use AEPS.
  • Can I use AEPS without a smartphone or internet connection?
  • Yes, AEPS does not require a smartphone or internet connection to make transactions.
  • Is AEPS secure?
  • Yes, AEPS uses biometric authentication, encryption, and other security features to ensure the safety of transactions.
  • What is the maximum amount that can be withdrawn through AEPS?
  • The maximum amount that can be withdrawn through AEPS is Rs. 10,000 per transaction.
  • Can I use AEPS for fund transfer?
  • Yes, AEPS can be used for fund transfer, cash deposit, cash withdrawal, and balance inquiry.

BANKIT is a financial service provider that offers a range of services such as AEPS, domestic money transfer, recharge, and mini ATM. However, when it comes to finding the best portal for these services, BANKIT is the one that stands out from the rest. In this article, we will explain why BANKIT is the best portal for AEPS, domestic money transfer, recharge, and mini ATM, and how it can benefit you.

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