Amidst the Centre's push for a cashless ecosystem, the Committee of Chief Ministers set up to promote digital payments has decided to set up an official panel to examine security concerns that could arise in such transactions and recommend measures to address them.
The 13-member CMs' Committee, at its second meeting on Friday, also recommended that Aadhaar-enabled payment transactions should be kept free for users. The Unique Identification Authority of India would shortly roll out a common Android-based Aadhaar Enabled Payment System (AEPS) application that has been developed in collaboration with TCS, to ease the cashless payments process for merchants.
The committee on security for digital payments will be headed by IT Secretary Aruna Sundararajan and Telecom Secretary J S Deepak. “Ministry of Electronics and IT (MeitY) would constitute a committee under the chairmanship of Secretary, MEITY and Secretary, Department of Telecommunications (DoT) to examine various security concerns relating to digital payments and recommend measures to address the issues,” an official release said.
Further, it was decided that the RBI should allow authentication through iris scanner and One Time Password (OTP) for AEPS. Additionally, there will be no charge on AEPS transactions. The committee has also pitched for inter-operability of all pre-paid instruments on the United Payments Interface (UPI) platform along with a common QRCode for simplifying transactions.
“In order to use this application for carrying out cashless transactions, merchants will need a smartphone and a fingerprint scanner. Transactions on this application can be done without any card or PIN. The application will be made available to all banks and the banks would encourage merchants in their vicinity to adopt this application,” the release by Niti Aayog said.
The Maharashtra government informed the committee that it will introduce an Aadhaar Bill in the legislative assembly to give legal status to the use of Aadhaar number for various purposes.
To popularize digital transactions the Committee has proposed a detailed review of the Merchant Discount Rate (MDR) regime, inter-linking of various digital payments platforms such as USSD (mobile short codes that can be used to make payments) with UPI, self-boarding by small merchants and a common application for UPI, among others.
It also set a time line of December 25, for roll out of the upgraded version of USSD that will make is simpler to use. It was decided that IT Secretary will prepare a status note on the procurement options for Point of Sales (PoS) machines and Micro Automatic teller Machines (ATMs) to help resolve issues relating to procurement of these equipment.
Post the meeting, Andhra Pradesh Chief Minister Chandrababu Naidu, who is also the Convener of the Committee, along with Niti Aayog Vice Chairman Arvind Panagariya also met with major telecom companies. “…the need to address issues relating to sufficient bandwidth for financial transactions, last-mile connectivity, affordability and security of digital transactions was discussed and several action points were identified,” the statement added.
