FASTag May Soon Cover Parking, Fuel, Insurance, And More

You may soon be able to use your vehicle’s FASTag for more than just paying highway tolls. The government is exploring ways to expand FASTag's utility to cover payments such as parking fees, traffic challans, insurance premiums, and even electric vehicle (EV) charging, according to a news report by The Times of India.

At a workshop held on June 25, the road transport and highways ministry, along with the National Highways Authority of India (NHAI), met top officials from the finance ministry and fintech firms to chart out FASTag’s next phase of growth. Road transport minister Nitin Gadkari said that with support from fintechs and stakeholders, FASTag can evolve into a robust digital payments platform that simplifies vehicle-related services.

FASTag adoption has already crossed 11 crore tags, and with the ‘One Vehicle, One Tag’ rule in place, authorities are keen to extend its reach. V Umashankar, the road transport secretary, stated that it's entirely possible to connect FASTag with services like fuel purchases and insurance. However, to make this seamless, the government must first clean up the ‘Vahan’ database, which currently includes around 7.5 crore inactive vehicle records.

Officials are also considering allowing insurance companies to issue FASTags, aiming to raise insured vehicle coverage from 50 per cent to as high as 90 per cent over the next three years, according to The Times of India report.

FASTag was launched in India in 2014 on a trial basis on the Ahmedabad-Mumbai highway. The idea was aimed at reducing waiting time at the tolls: allowing vehicles to pass through unimpeded while the toll is collected. It uses Radio Frequency Identification (RFID) technology, wherein the tag is linked to a prepaid account or wallet. Upon crossing the vehicle at the toll plaza, the deduction of fees takes place automatically.

Adoption was initially slow. There were issues of mistrust regarding electronic toll collection, and part of the infrastructure was limited. In the years that followed, the government strongly pushed for FASTag's adoption. Several banks and digital wallets started issuing FASTags, leading to increased awareness of them.

With the coming into effect of FASTag by December 2019, all vehicles had to have FASTags for use on national highways. Exclusive lanes were set up so that all vehicles that approach the FASTag lane without a tag would pay double the toll amount.

Thus, the system has rapidly expanded, and presently, FASTag has seamless acceptance at the majority of toll plazas across India. Making travel on highways more efficient and wastage of fuel reduced by adding a significant amount of transparency in toll collection.