FASTag: All you need to know

FASTag: All you need to know

FASTag has become a new normal for motorists in India. The small chip-based stickers are digitalising the Indian highways and promising a smoother, transparent toll payment system.

FASTag is making headlines across the country again for the last couple of days as according to a government mandate, it has become mandatory to have onboard the vehicles that ply on highways. Despite the initial hiccups, FASTag penetration across India is picking up steadily from June 2020, since the economy started reopening gradually after the rigorous lockdown.

The FASTag penetration reached an all-time high of 148.5 million monthly transactions in January 2021, as revealed by National Payments Corporation of India (NPCI) data. The total value of the digital toll service increased to Rs 2,397 crores in January 2021.

A few statistics are probably sufficient to help understand the penetration level. Digital wallet service provider PhonePe claims that new user recharges for FASTags increased by 23% in February 2021 when compared to January 2021. In between November and December 2020, Paytm Payments Bank had added almost close to 20 lakh new users. In January and February 2021, it added another 10 lakh new users to the FASTag network.

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What is FASTag?

FASTag is one of the newest vehicle identification technologies being adopted and used in India to make toll payments easier, faster, and less hassle-free for vehicle owners by using Radio Frequency Identification Technology (RFID). In this case, an RFID chip-enabled sticker is placed on the front windshield of a vehicle that allows the sensors at toll booths to detect it and deduct the money from the vehicle owner’s account directly, which is linked to the specific FASTag.

This way, the vehicle doesn’t need to stop at the toll booth for payment of the tax. FASTag was introduced by the Government of India back in November 2016, by the Ministry of Road, Transport, and Highways (MoRTH). It was brought into action across the country after a lot of scrutiny by vehicle owners, toll booth operators and was analysed by government officials.

Reasons behind FASTag implementation

As per research, it was found that an amount of approximately Rs 12,000 crores is lost annually at the toll plazas across India. There are two different components that are deemed responsible for this huge loss.

  • The loss of fuel while standing at toll plaza queues.
  • The use of the human resources at toll plazas.

While these two components account for financial de-stability, another major setback is observed – air pollution. India is one of the countries with air pollution levels in the world and the long queues at the toll plazas only make the scenario worse. Even though toll plaza queues are one of the primary contributors to air pollution, the agenda of bringing in FASTag aims at bringing down that minuscule level as well and contribute to the cumulative effort of bringing down the air pollution level in the country.

Apart from the factors like air pollution, saving a huge amount of money by reducing the time-consuming process, the implementation of FASTag is also aimed at making the whole tax collection process smoother and more transparent through the digital medium.

FASTag

How does FASTag work?

The FASTag works in a similar fashion to other Radio Frequency Identification Systems (RFID) by applying the technology of READING. When a vehicle owner applies for FASTag, he/she receives a chip-enabled sticker, which is to be stuck in the upper middle region of a car’s front windshield. When this car passes through a FASTag enabled toll booth, the reader installed at the booth scans the fixed tag, and payment is initiated from the bank account linked to the tag. While passing through a FASTag lane, the car doesn’t need to halt to exchange money. The process is completed automatically, as explained above.

These readers at the toll booths are enabled to scan the FASTag card while it is in motion; wherein it emits a signal to the FASTag card to request toll fee payment, and the card reverts with confirmation of the payment. It is essential that a FASTag card is linked with a digital wallet or savings account to enable toll fee payment Also, the account or the digital wallet has to have the required balance prior to the payment.

The Minister of Road, Transport, and Highways Nitin Gadkari said that all commercial vehicles and private vehicles will be required to have FASTag onboard. As per a statement by the MoRTH, more than 1.15 crore FASTag cards have been issued as of 31st December 2019. It was also mentioned in the statement that approximately 100,000 cards are issued every day with more than 3 million transactions taking place daily across the country. Now, as per government mandate, FASTag has become mandatory across India from 15th February 2021.

No FASTag, pay double

If a vehicle doesn’t have a FASTag, then the owner of that vehicle has to pay double the amount for the toll tax, as per the new mandate by the Government of India. National Highway Authority of India (NHAI), which is responsible for the registration and distribution of FASTag cards, mentioned that more than 540 toll booths across India have been enabled with FASTag reading technology. Keeping this growing figure in mind, it becomes important to get FASTags for all vehicle owners to avoid paying double tax during long journeys.

How to get a FASTag?

To get a FASTag for a vehicle, the following steps can be taken.

  • NHAI has authorized 22 banks to sell FASTag cards. These banks and their branches, along with NHAI plazas, petrol pumps, common service centers, and transport hubs have set up more than 28,000 point-of-sale (POS) terminals across India. Also, a vehicle owner need not be an existing customer of any of the authorized banks. He or she can avail the FASTag from the websites of these banks, in minutes. Also, several digital platforms such as Paytm and Amazon too provide FASTag issuing services.
  • A vehicle owner needs to have his or her KYC documents, residential proof, and identity proof to apply for FASTag. The KYC documents vary from one bank to another. In addition, the vehicle registration papers (RC) also need to be provided, irrespective of online or offline issuing of the cards.
  • The Ministry of Road Transport didn’t ask for any fee for the issuing of FASTag cards until 1st December 2019. But now, one might have to shell out a fee to avail FASTags. This fee constitutes a refundable deposit, insurance fee, or deposit and the minimum required balance in the attached e-wallet. The fee varies with the varying issuing authority. But the Government of India has set a mark, for which the issuance fee won’t be more than Rs 200.
  • In case one avails FASTag from an authorised bank, the card will be available as pre-activated. In the event one purchases the card from Amazon, he or she will be provided with a blank FASTag sticker. Next, the person will need to register the card with the vehicle and then add a payment method to it.

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