The government’s ambitious move to allow every consumer with an Aadhaar number to undertake digital payments directly at merchant outlets by using their biometric details is getting caught up in issues around interchange fees and sharing of costs between participating entities. National Payments Corporation of India (NPCI), the nodal body for Aadhaar-enabled Payment System (AePS) transactions, has held back introduction of the new charges for each transaction, which were decided in April.
A debate around prices has split the banking world through the middle where multiple large banks who have a large customer base are against any minimum interchange fee, while younger generation banks said the current charges are not enough to encourage players to deploy more terminals.
As per the April circular, the interchange fees for every AePS transaction was fixed at1% of the transaction amount with minimum charge of Rs 5 and maximum of Rs 15.
The existing rates are 0.5% for every transaction and no charges for transactions less than Rs 100.
