Payments and financial inclusion company Fino Paytech will be deploying 5,000 Aadhaar-enabled micro ATMs across villages in Haryana, Madhya Pradesh, Bihar, Gujarat and Maharashtra as part of National Bank for Agriculture and Rural Development’s (NABARD) push for rural banking.

Fino Paytech will provide these to district central cooperative banks and Primary Agricultural Credit Societies (PACS) across these states. The company added that Haryana State Cooperative Apex Bank (HARCO) will deploy Aadhaar enabled micro ATMs across 600 branches of the 20 district cooperative central banks in Haryana.

Note that NABARD will be providing support to the banks to cover one lakh tier 5 and 6 villages with up to two Aadhaar micro ATMs per village. NABARD will support 80% of the cost of the micro ATMs with a cap of Rs 6,000 per machine. Minister of finance Santosh Kumar Gangwar said this in a reply to the Lok Sabha. He added that NABARD has approved an incentive scheme for merchants of 0.5% of transaction values up to Rs 2,000, subject to a cap of Rs 10 per transaction, and a maximum of Rs 10,000 per merchant per month from the Financial Inclusion Fund for Aadhaar-based merchant transactions.

Plans for more PoS machines

During the Union Budget for 2017-18, finance minister Arun Jaitley said that 20 lakh Aadhaar POS devices, which can process Aadhaar payments and card payments, would be set up in the country.  Aadhaar payments on POS machines can be done on the Aadhaar Enabled Payment System (AEPS) protocol. The AEPS is a financial inclusion product developed by the NPCI which allows cash withdrawal, deposit, and funds transfer at Micro ATM through a business correspondent.

PoS machines need to have Aadhaar and biometric capabilities

Note that the Reserve Bank of India (RBI) said that all new card acceptance devices, including micro ATMs, will need to have Aadhaar and biometric capabilities and companies have a deadline of June 30, 2017 to comply.  The RBI said that it would be coming out with detailed guidelines on enablement of existing card acceptance infrastructure for processing payment transactions using Aadhaar-based biometric authentication, although a date was not mentioned.