Govt to enrol more banks for toll collection

Single clearing house mooted, banks to be incentivised for each transaction at electronic toll plaza and for each tag sold

The government is planning to enrol more banks for FASTag — a radio frequency identification device that enables cashless transaction at toll plazas — to increase the penetration of electronic tolling. It also plans to have a single clearing house instead of two at present.

According to sources, the ministry of road transport and highways will invite fresh tenders in the next two months. The plan is to incentivise banks for each transaction at electronic toll plaza and for each tag sold, besides part-funding the cost of setting up clearing house.

ICICI Bank and Axis Bank are currently enrolled for electronic toll collection (ETC) and both banks have separate clearing houses.

FASTag is currently operational on Delhi-Mumbai, Delhi-Chandigarh and Bengaluru-Chennai highways. There are 35 toll plazas spread across these three stretches with the user base restricted to 2,200.

Vijay Chhibber, secretary, department of road, transport and highways, told Business Standard: “Despite its features, FASTags were not as popular as we were anticipating. The banks were seen charging transaction fee from the users, which acted as a deterrent. So we have decided to invite fresh tenders in the next two months for setting up a clearing house and enrolling more banks for popularising FASTag among road users.”

ETC is expected to provide seamless and cashless movement through all national highways across the country by December this year. Under the proposal, there will be at least one dedicated lane in toll plazas. The ETC system offers the convenience of electronically paying toll at any toll collection point through a single prepaid account.

“Installation of ETC systems at the toll plazas requires Rs 50 lakh each (for one lane). We have identified around 300 toll plazas across the country for implementing the system making one lane dedicated to ETC,” said a senior official, who did not to be named.

Vehicles owners currently use the prepaid account with ICICI Bank and Axis Bank. Upon successful registration, the bank issues a prepaid FASTag, which uniquely identifies the vehicle. FASTag is affixed on the vehicle’s windshield and whenever the vehicle crosses a toll plaza, the applicable toll is deducted automatically from its pre-paid account.

The ETC transaction generated at toll plazas are sent to the Central Clearing House for debiting appropriate toll fee from the account of registered vehicle and crediting the same to the respective toll collection agency. The road users also gets an SMS alert for each ETC transaction.

The technology is expected to save time as well as fuel. According to road transport and highways minister Nitin Gadkari, this would result in savings of Rs 27,000 crore in delays caused at tolls and Rs 7,000 crore worth of fuel.

To implement ETC across the country, the ministry has incorporated Indian Highways Management Company with equity participation from NHAI (25 per cent), concessionaires (50 per cent) and financial institutions (25 per cent).

"Tracking of vehicles is possible as the registered mobile number gets an SMS each time the vehicles crosses toll plaza using FASTag," Gadkari said.

Toll operations in India are mostly manual with the collection of money is done manually and toll receipts issued with the help of computers. The existing system has been marred with various controversies as it is associated with delays at collection points and congestion at toll plazas, resulting in wastage of time and fuel.