Future of FASTag in India

by | Jul 6, 2023

Is the FASTag era coming to an end?  

This is a question that plagues 96.3% of vehicle owners who are ardent fans of the FASTag system. To clear the air, we sought expert opinions from our leaders Aditya Narasimhan – VP, Fleet Product, and Bhargav Yogesh Padh – Head, Fleet Business.  

Not FASTag, just the toll plazas 

First off, vehicle owners might not have to worry.  FASTag system is not drawing to a close. Instead, the government is taking measures to deploy greater technological advances in tolling infrastructure to further optimize toll payments, reduce waiting time, decrease cost, and increase transparency. 

What makes FASTag irreplaceable?  

National Electronic Toll Collection (NETC) program by the National Payments Corporation of India (NPCI) aims to digitize toll collection. NETC’s FASTag offers the convenience of cashless payments along with benefits like savings on fuel and time, as the end user does not have to stop for a long time at toll plazas. The average waiting time of vehicles at toll plazas reduced from a solid 8 minutes to just 47 seconds with the implementation of FASTag.  

FASTag is a boon to anyone involved in road travel, be it fleet companies, vehicle owners, truckers, and drivers. Today, FASTag balances can be used to pay for other trip expenses like parking, fuel, food, and even miscellaneous expenses, depending on the issuing banks. The key features and benefits (listed below) make FASTag irreplaceable for the fleet.

As of 31st December 2022, NETC issued a total of 6,33,05,104 tags. The success of the program has been attributed primarily to the collaborative efforts of various stakeholders, including the National Highways Authority of India (NHAI), Indian Highways Management Company Limited (IHMCL), NPCI, 38 issuer banks, 14 acquirer banks, concessionaires/toll operators, system integrators, and tag manufacturers.

“India is a diverse country in terms of culture, people, language, business, and more. We cannot compare it with the western world in terms of technology adoption. So, when the committee led by Mr. Nilekani recommended a passive RFID-based solution, it was an approach that made toll collection more streamlined and transparent while keeping implementation costs limited. 

Now, post the ~97% penetration of FASTag when we look for better technology, we should not be forgetting the journey we took over the past 6 to 7 years and set it aside. Rather, we should build on it so that FASTag becomes the base for newer technologies. 

If you ask me, while we move towards free flow or GNSS/ ANPR based toll collection, I strongly feel that the existing 50+ Million FASTag prepaid/ CASA linked wallets should be used for toll fare deduction. Let technology be incrementally beneficial as well as complementary rather than a hard rip-off leading to chaos and a fresh new implementation/adoption cycle.” Bhargav Yogesh Padh, Head, Fleet Business 

Technological Advances- GPS, ANPR 

As the volume of traffic in India increases, there is a need for a more efficient and resilient toll collection program. Such a system will help tackle issues associated with long queues, connectivity hassles, and the cost of building and maintaining toll plazas.  

To make toll collection seamless and hassle-free, the Government of India (GoI) has leveraged technology and innovation. GoI may upgrade the front-end toll collection mechanism from physical toll plazas and RFID tags to barrierless toll collection systems. Fully automated Global Navigation Satellite System (GNSS) and Automatic Number Plate-Recognition (ANPR) are technologies chosen by the Government of India for the upgrade. GNSS and ANPR pilot projects are underway at a few toll plazas. If the technology results in seamless payments and vehicle movement on national highways, it will go to the next level, and toll plazas will start phasing out. 

1. Global Navigation Satellite System (GNSS) or Global Positioning System (GPS)  

In the navigation satellite-based toll payment, the collection will be based on the distance the vehicle travels on the roadway. The vehicle’s movement will be tracked with the help of the Global Navigation Satellite System (GNSS). There will be no waiting time or queues as the vehicle can pass without the need to stop at toll plazas. This could significantly reduce fuel consumption and travel time. 

We presume that Onboard Units (OBUs) will be used for GNSS to track the vehicles. GNSS will calculate the distance covered by the vehicle using its connectivity with the OBU and the toll fare will be deducted accordingly. We suppose that per km fare for each category of the vehicle on a different highway, stretches would be pre-defined for toll calculation.  

2. Automatic Number Plate Recognition (ANPR)  

In the case of ANPR, the vehicle number plates will be captured using high-speed cameras, and the registration number will be extracted for payments. The toll will be deducted directly from the bank account of the end user. However, there will be challenges like the authentication of number plates. India is a diverse country, there are non-standardization challenges wherein people use local languages, and various designs around number plates, which could impact the accuracy levels of ANPR. Also, if the number is more than 9 digits, the camera will not read the number plate. These situations could lead to revenue loss.   

Now, both GPS and ANPR technologies will involve direct bank transfers for toll collection, to add more discipline to the process and save cost, time, and effort. However, sidelining FASTag from being the preferred wallet for deduction could be challenging as 50 million plus vehicles already have it affixed. And certain changes around enforcement and recoveries remain and that need to be addressed by competent authorities and ecosystem stakeholders alike to implement either one of these.  

“With the world being mindful of the GHG emissions, the introduction of GPS-based and ANPR for toll collection is a clear direction to bring more transparency and enable data-driven principles. The most obvious approach is to track vehicle utilization, and contribution to carbon emissions, and innovate these models. Toll collections through these channels will set a huge ground for many players in Payments/GPS/Insurance/Vehicle Accessories in the ecosystem to innovate and contribute to this change.” – Aditya Narasimhan, VP- Product, M2P Fintech. 

How can fleet owners future-proof their businesses? 

To future-proof fleet businesses, owners must be armed with a holistic payment solution that is robust and flexible enough to keep costs under control yet accommodate the innovations in the supply chain ecosystem. A unified fleet payment and expense management mechanism will enable you to reap multiple benefits in today’s rapidly evolving fleet scenarios. The payment solution must be multipurpose and serve as a single source for all trip expenses (food, fuel, parking, and miscellaneous purchase).  

Here is a list of key features your fleet payment solution must have for maximized benefits.  

  • Ability to link multiple vehicles with a single account.  
  • Issuance of physical/virtual card linked to the FASTag wallet  
  • Instant fund loading  
  • End-to-end trip expense management  
  • Single dashboard for reconciliation across toll, parking, fuel, and miscellaneous expenses

QuikWallet FASTag is India’s first Multi-Purpose FASTag. We enable fleet owners to onboard multiple vehicles and manage the allocation of funds through a single virtual account. The wallet also gives an end-to-end trip expense management solution through APIs as well as a simplified web-based portal.  

To know more about QuikWallet FASTag and how you can future-proof your fleet operations, Visit our website.