Aadhaar Enabled Payment System (AePS) is a system developed by the National Payments Corporation of India (NPCI) that allows people to carry out financial transactions on a Micro-ATM by furnishing just their Aadhaar number and verifying it with the help of their fingerprint/iris scan.
People do not have to mention their bank account details to carry out these transactions. With the help of this payment system, people can send funds from one bank account to another simply through their Aadhaar numbers. As the system works on a centralised server, people can send money from their account to any account irrespective of the bank in which the receiver’s account is operated.
This system will add another layer of security to financial transactions as bank details would no longer be required to be furnished while carrying out these transactions and fingerprints of the account holder will be required for authorising the transaction.
Banking, as well as non-banking transactions, can be performed through a banking correspondent.
Banking correspondents of one bank can perform transactions of other banks as well.
People do not have to furnish their debit/credit card for making transactions through AePS.
The fingerprint is needed for transaction authentication which makes it safer.
Micro PoS machines can be taken to distant places enabling people in remote villages to make transactions instantly.