New Delhi. Banks have started pressurizing them to increase their margins in lieu of toll payment done through FASTag. Banks have written to the National Highways Authority of India (NHAI) asking them to increase the FASTag Project Management Fee (PMF).
The Indian Banks Association (IBA), in its recommendation sent to NHAI and the Ministry of Road Transport, has said that keeping in view the interests of banks, the old rate of PMF should be restored. Banks used to get 1.5 percent PMF of the total amount for every payment on toll. But, NHAI has reduced this amount to 1 percent with effect from April, 2022. The association said that the old rate of PMF should be implemented for at least two more years and it should be changed only after March 31, 2024.
95% toll collection with FASTag When a vehicle passes through a toll plaza, banks automatically pay the toll tax through its FASTag. Banks also charge a fee for this service. At present, FASTag accounts for 95 percent of the total payments made at toll plazas. Experts say that if the margins of banks are increased again, then there is a great possibility that the fee for using FASTag may also increase further.
Banks said big loss
Banks have said in the recommendation sent through IBA that they are incurring a big loss due to reduction in interchange fees. The interchange fee was reduced from 1.5 per cent to 1 per cent with effect from April 1, and since then the business earnings of NETC FASTag have declined by 31 per cent. Giridhar Armane, Secretary, Ministry of Road Transport has said that NPCI and banks are demanding a hike in PMF fees and we are trying to find a solution with them. Some decision on this is expected soon.
FASTag increased toll collection
According to the data released by the Ministry of Roads, there has been a big jump in toll collection after FASTag became mandatory. In 2018, where the use of FASTag was only 16 percent, now it has increased to 96 percent. In 2018, the total toll collection was 22 thousand crores, of which 3,500 crores were of FASTag. In 2022, the total toll collected was Rs 34,500 crore, in which the share of FASTag was more than Rs 33 thousand crore. The government is expected to reach 40 thousand crores of rupees soon.
