Opinion

Benefits of FASTag extend beyond decluttering of toll plazas

Pranavant | Updated on December 24, 2019 Published on December 24, 2019

A payment mode at fuel stations apart, FASTags linked with GST e-way bills will enable State authorities track commercial vehicles deviating from their permissible routes

Imagine a vehicle travelling across the highway network in India and manually paying tolls at various toll plazas. This toll payment process involves the ticket collector collecting cash from the road users, giving them the receipt and the change, and then opening the tollgate to allow the vehicle to pass through.

Assuming that the vehicle takes 60 seconds in the above activities and crosses on an average five plazas per day, the average stop time for the vehicle in a month is approximately two-and-a-half hours. Multiply this with millions of vehicles and taking into account the 480-plus plazas across the NH network alone, we can estimate how the slow speeds and delays at toll plazas cost the country, besides the health impact of multiple vehicles spewing pollution across the country.

With last year’s toll collection on National Highways crossing ₹23,000 crore, it provides one of the important financing mechanism for upgradation of the National Highways. The Union Minister for Road Transport and Highways Nitin Gadkari has ruled out the waiving off toll collection on National Highways.

In this backdrop, it is imperative for the government to work towards taking steps to reduce the time taken to cross a toll plaza. Perhaps a prudent solution to the problem lies in adopting technologies that reduce the waiting time at the plazas and allow the vehicle to pass through the plaza without stopping. If we were to reduce the waiting time to six seconds from 60 seconds, the average stop time per vehicle would be reduced to around 15 minutes per month.

 

Some of the potential technologies in this regard could include: traditional swipe-based credit: transaction time, around 40 seconds; near field communication (NFC) cards: transaction time, around 12 seconds; and radio frequency based cards (RFiD): transaction time, 3-4 seconds.

Given the fastest response time, it is no wonder that the government has adopted the technology under the name FASTag, towards trying to de-clutter the toll plazas across national highways and offer better services to the road users. This also has the potential to significantly reduce the cash transactions at the toll plazas, thereby giving a boost to the government’s initiative for digital payments. The programme has witnessed exponential growth over the years and now contributes over 25 per cent of the total toll collection at the plazas from a mere 2 per cent contribution in 2016.

FASTags are now live on more than five million vehicles and are expected to enter a new era with the government mandating the use of FASTags across toll plazas, except for one cash lane (on each side). The programme numbers show a month on month growth of more than 25 per cent in FASTag sales over the past few months.

With an aim to offer even better services to the end-user, the authorities are partnering with various state agencies to enable FASTag-based payments even at non-NH toll plazas.

Non-toll avenues

However, perhaps the biggest benefits of the programme lies in the non-toll related avenues associated with FASTags. For example, FASTags linked with GST e-way bills could enable authorities to track a vehicle entry across boundaries without physical barriers. It could also enable State authorities to track commercial vehicles deviating from their permissible routes.

Some agencies are already planning to offer FASTag-based payments at fuel stations.

Even the above initiatives are a tip of the iceberg of the programme’s potential, and it is imperative for policymakers to keep up the momentum and explore new avenues with the programme. For example, FASTag can offer distance-based tolling across the highways and enable users to pay only for the distance that they have travelled.

FASTags can offer variable tolling rates at selected stretches and enable authorities to vary the traffic volumes as per requirements. With the current thrust on accelerating adoption of electric mobility in the country, FASTag can also provide a non-obtrusive payment mode for electric vehicle charging stations. We are optimistic that the programme will receive the desired support and upgrades to enable it to offer the best value to Indian highway users.

The writer is Partner, Deloitte India

 

Published on December 24, 2019
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