PM Narendra Modi Launches BHIM Aadhaar Pay App to Push digital Online Payments


The demonetization of old currency notes in November last year offered a much-needed boost to digital payments. To simplify digital payments further, PM Narendra Modi launched BHIM Aadhaar, a Unified Payments Interface (UPI)-based app in December last year.

Now, on the occasion of Dr. Babasaheb Bhimrao Ambedkar’s 126th birth anniversary, PM Modi launched the new BHIM Aadhaar service in Nagpur. It is a merchant interface of the BHIM app that will allow users to make digital payments using their fingerprint.

Among the currently available digital payment modes BHIM app, Bharat QR and mobile wallets among others one needs to have a smartphone and an internet connection to make a transaction. There is also USSD-based mobile banking service for feature phones, where you can send and receive money without an internet connection.

BHIM Aadhaar

It is as simple as checking your mobile balance. However, for all these modes of digital payments, you need a mobile phone. This is what BHIM Aadhaar aims to change.

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What is BHIM Aadhaar And How Does It Work?

According to the recent figures released by the government, digital payment transactions increased 23 times since demonetization on November 8 last year. The credit of this can be given to the rise in smartphone and internet usage.

What about those in rural areas who don’t have access to smartphones, internet, credit and debit cards?

With the new BHIM Aadhaar service, any Indian citizen with a bank account and Aadhaar card can make cashless payments. With a tagline that says ‘New India, New Economy,’ the BHIM Aadhaar app will do away with the need of having a smartphone, internet, and credit/debit cards to make digital payments.

As of now, 27 major banks are onboard with the platform along with 300,000 merchants who will start accepting payments using the new platform. It will use Aadhaar Payment Bridge and Aadhaar-Enabled Payment System to authenticate the transactions.

Merchants will need a smartphone and the biometric-enabled device to read the biometric data. And all you need is your 12-digit Aadhaar number and your thumb. So, the next time you go to nearby general stores, a shopping mall, an electronics store or even to buy milk or vegetables, you don’t need to carry your wallet or smartphone.

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To make a transaction, the merchant will need to enter your Aadhaar number in the app, select your bank account, enter the amount and scan your fingerprint on the biometric device. That’s it. Now, your fingerprint is your bank and your identity.


The BHIM-Aadhaar channel is “reverse” MDR, said AB Pandey, CEO of the Unique Identification Authority of India (UIDAI), which runs Aadhaar. “There is a strong logic for an incentive per transaction since money is being spent by the merchant and the banks for putting in the infrastructure,” Pandey said. “Back end is being handled by Aadhaar, so why should customers pay? Also, we need to encourage digital transactions.”

The government has allocated Rs 495 crore for a period of six months for the scheme, which will be paid from the Digital Inclusion Fund. Almost 715,000 merchants are already on the BHIM platform, the government said.

Modi described the cashless movement as a “safai abhiyaan”, a cleanliness campaign aimed at fighting the “menace” of corruption and black money. After demonetization was announced, India has been pushing ahead with its digital economy agenda.

According to government estimates, the volume of digital transactions increased about 23 times to 6.38 million for a value of Rs 2,425 crore in March compared with 280,000 worth Rs 101 crore until November 2016.

The Prime Minister pointed out that lowering cash use will lead to big savings. “You will be surprised that in a country like India, printing currency costs crores. That money can be used for building homes for the poor,” he said. Modi dismissed criticisms against Aadhaar by privacy activists who have expressed doubts about its security and the prospect of surveillance.

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Modi also launched the Referral Bonus and Cash Back schemes to promote digital payments. The first will pay Rs 10 to a BHIM user who refers a new one. Under the Cash Back scheme, merchants will get money back on every transaction using BHIM.

Potential to be a ‘Catalytic Agent’

IT Minister Ravi Shankar Prasad came in for praise from Prime Minister for a role in the roll out of Aadhaar enabled BHIM App which PM claimed to have generated Interest among leaders of other countries. Narendra Modi, in fact, suggested IT Minister Ravi Shankar get BHIM-Aadhaar App patented given its transformative potential that could be leveraged globally.

“It is only matter of time that the global universities will flock India for the case study of BHIM-Aadhaar … Only yesterday I asked Ravi Shankar Prasad whether he has got the entire initiative patented.

The world is showing a curious interest in it,” PM said. PM revealed that leaders of African countries have evinced interest in this path-breaking initiative and India held potential to become a “catalytic agent” for this use of technology at the global level.


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