FASTag is part of NETC (National Electronic Toll Collection) program by NPCI designed to provide an interoperable method of toll collection across the country irrespective of the acquirer, simple meaning that your FASTag device issued by any issuer will work on any toll plaza across the country irrespective of its acquirer. That is the benefit you get when working with NPCI.
Couple of days back a friend working in transit payments called me to understand how FASTag works. That call gave me impression to write this post. Here I will be explaining the transaction flow of a FASTag transaction in simple terms:
What is FASTag?
FASTag is a RFID tag that stores static information like TAG ID, which can be read by the receivers installed at toll plazas.
How it is issued?
FASTag can be issued by any NETC member banks and it is linked to either your Current or Savings account maintained with the bank or a prepaid account created by the bank for this specific purpose. My bank gave me a prepaid account with separate credentials for inquiry and other financial transactions. In my opinion it will be wise for fleet companies to link FASTag for their vehicles to current account maintained by the company.
At the time of issuance a TAG ID is created, which is then linked to a CASA Account or Prepaid Account, depending on the implementation at your bank and your vehicle details like vehicle type (car, truck etc.) and category (personal, commercial etc.). TAG ID along with Vehicle details and Bank ID are then added in NETC mapper maintained by NPCI. As soon as your details are updated in NETC mapper, your FASTag is ready to use.
How it works?
Step 1: As soon as RFID tag affixed to the windshield of your vehicle is in range of the acceptance terminal installed at toll gate, terminal read the TAG ID and Vehicle Details and send them to acquiring bank
Step 2: Acquiring bank sends the details received from the terminal to NETC mapper,
Step 3: NETC Mapper validates the details collected from the TAG and responds with TAG Status. If TAG Status is active, it proceeds to next step else driver needs to pay cash. Other possibilities could be TAG is not registered yet (new TAG), TAG is blacklisted etc.
Step 4: After successful validation of TAG details and status, Acquirer system calculates the toll amount to be collected and sends to NETC Mapper.
Step 5: NETC System sends the debit request to issuing bank, based on the issuer bank ID maintained in the Mapper.
Step 6: Issuer system processes the debit into customer’s account linked to FASTag and sends response back to NETC system. In case no response is received with-in the defined time-out period it is assumed to be approved automatically.
Step 7: NETC System sends a notification to the acquirer system
Step 8: Acquirer system sends notification to respective toll plaza system
This transaction is performed in offline mode with systems syncing every 10 minutes. This means that by the time Step 8 happens your car is already far away from the toll-plaza. Once the TAG ID is validated and its status is found to be active, it is assumed that there is enough balance maintained at the bank’s end to settle the transaction, which happens at every settlement cycle and facilitated by NPCI through a system called EGCS (ETC Global Clearing and Settlement).
NPCI basically collects the money from issuer banks and distributes it among acquirer banks as per the transactions processed during the settlement cycle. Acquirer bank then settles the funds with respective toll plazas.
What happens if your account does not have money?
Since the value of toll is usually small and syncing cycle is ten minutes, the exposure due to lack of funds in account is very limited. Having said that banks have a provision of keeping a security deposit for safeguarding themselves in any such possibility. In case your account does not have necessary funds to pay for the toll, same is deducted from your security and your FASTag is blacklisted and updated in NETC mapper to stop further transactions on that TAG till balance is maintained again.
My bank has taken 500 Rs as security deposit. The assumption is that for a private vehicle to pass through so many toll plazas with-in 10 minutes is practically very remote. I am assuming for heavy/commercial vehicles this security deposit would be higher. In case of fleet companies having multiple tags linked to same current account there might be a special arrangement negotiated with the issuer bank.
How to reload a FASTag account?
In case it is linked to your savings or current account, there is no question of separately reloading the account. While my bank doesn’t offer me this option, I am assuming, whichever banks would be offering this option must be keeping some cap on the amount from safeguarding perspective.
In case of prepaid account set-up like my bank, I have been given multiple options to reload. Your bank may even offer an auto-reload option where, if your balance goes below a particular threshold bank can initiate a reload by debiting your linked account or card that you may have provided while setting up the FASTag account.
This is the simplest explanation I could come up with for FASTag transaction flow that is easy to understand by most and also explains how it can be achieved at the speed of traffic i.e. your car practically doesn’t need to stop at the plaza for deducting the toll. This is unlike the regular transit card solutions where balance is usually maintained at the chip inside the card and offline balance is updated at the time of transaction.
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