Transactions can't be executed through open internet connectivity, says NPCI.
Paytm and NPCI (National Payments Corporation of India) have issued a clarification regarding the safety of its FASTag after a video alleging a scam went viral on the internet.
The clip in question showed a child scanning the FASTag with his smartwatch after he is done wiping the windshield of a car. When questioned by the driver about the watch, the kid runs away quickly.
The video then showed the driver claiming that the kid is part of a larger scam in which fraudsters have given smartwatches with scanners to children who beg at traffic signals. The man alleged that when the children hold their watches near the FASTag, money is debited from the driver's account.
However, the video has now been debunked.
Taking to Twitter, Paytm branded the clip as “fake”. In the caption, it stated, “A video is spreading misinformation about Paytm FASTag that incorrectly shows a smartwatch scanning FASTag. As per NETC guidelines, FASTag payments can be initiated only by authorised merchants, onboarded after multiple rounds of testing. Paytm FASTag is completely safe & secure.”
Also Read | PM Modi In Germany To Attend G7 Summit
Separately, the NPCI, the umbrella organisation for all retail payments system in India, also published a statement, calling the claims “baseless”. It said that no transactions can be executed through open internet connectivity. It also stated that no financial transactions can be initiated without all the pre-requisites mentioned in the image.
Further, the organisation clarified that the National Electronic Toll Collection (NETC) FASTag Ecosystem is built on a 4-party model including NPCI, Acquirer Bank, Issuer Bank and Toll Plazas. Several layers of security protocols are placed to ensure the end-to-end safe processing of transactions, it added.
FASTags have become common to facilitate electronic toll collection in India. It is a tag fitted on vehicles and is operated by 23 banks governed by NPCI and the National Highway Authority of India (NHAI). FASTag was introduced to eliminate human intervention in the toll collection system by using Radio Frequency Identification (RFID) technology.
FASTags are mandatory for all commercial as well as personal four-wheelers for payments at toll plazas. The rule came into effect last year in February.