FASTag & The Future of Fare Collection

FASTag, based on Radio Frequency Identification technology to facilitate e-tolling, was made mandatory from February 16, 2021. First gaining prominence in December 2016, it is an easy tool of digitizing toll collections by means of automatic deduction of charges. However, the recent policy of making FASTag binding for vehicles has a far-reaching impact on India’s transport sector, toll collection mechanisms and fuel emissions. This article explicates on these dynamics of FASTag, subsequently observing its impact on the future of fare collection systems.

Toiling at Toll Plazas

One of the primary objectives behind the introduction of FASTag has been to curb the delays at booths and in turn reducing fuel emissions. Persisting delays at toll plazas annually cost the Indian economy around ₹27,000 crore. The technology has swiftly been adopted by the private players and citizens alike. On February 28, total toll plazas facilitating digital payments crossed 794 state and national highways (Press Trust of India, 2021).

Along with promoting e-tolling and reducing carbon emissions, it also removes the possibilities of leakages in the system. Since the earlier fare collection system depended on manual operations and transfer of hands, the misuse or pocketing of funds by middlemen was not uncommon. Hence, with the mandatory, country-wide adoption of FASTag, the revenue with the government has augmented, reaching record heights.

Moreover, the 2021 policy was not the first but an addition to the series to similar policies. In December 2017, FASTag was made mandatory to register all four-wheelers purchased in India. Similarly, for vehicles with national permits, it has been mandatory since 1 October, 2019. Thus, one can observe that behind the successful implementation of the policy, the commercial transport sector has brought a considerable change. Since it accounts for 75% of the total toll traffic, rising acceptance of FASTag in the sector augurs well for the overall revenue collection (Nandi, 2020).

Summarily, FASTag was rolled across state and national highways due to the following perceived benefits:

  1. Reduced waiting time
  2. Direct transfer of toll tax
  3. Reducing carbon emissions

However, the entire system has not yet resolved teething problems which has resulted in sustenance of the status quo, especially in terms of waiting time.

Glitches & Gaps

Due to technical failures on part of the RFID reader, vehicles actually took longer time to pay charges. Occasionally it has been unsuccessful in fulfilling its chief objective of decluttering toll booths. At the travellers’ end, glitches have led to double deductions, unreasonable exemptions, no discount in case of return journey and even loss of revenue as some charges weren’t processed (Naik, 2020). One of the main reasons behind this has been the variable angles and heights at which the readers are installed.

In particular, the absence of the indispensable discount on return journey has led to discontent among commuters. This technical issue is seen within the context of the government’s policy of mandatory FASTag. As per a circular released by NHAI on 15th January 2020, it was declared that the discount would be available only if payment was paid from FASTag. These teething issues have aggravated the growing district regarding infrastructure laid for its implementation. 

For instance, technical glitches troubled commuters at toll plazas on Delhi-Jaipur highway. They were compelled to pay double in cash despite sufficient balance in the FASTag account (Alam, 2021). In other series of incidents, commuters having both ETC and FASTag technologies paid double the amount of charge. Mishandling and tampering with the readers by booth operation to pocket extra money is also a likely cause behind technological failure.

Climatic conditions such as dew and dust also impair the reader’s ability to detect the account underneath, leading to long queues and waiting periods at toll booths (Rupani, 2021). In addition to these possibilities, the perils of data breach and state surveillance are amongst the grave doubts that are cast over the future of FASTag in the fare collection system.

Future of FASTag

In view of the Union Transport Minister Nitin Gadkari, the wide scale adoption of FASTag across the country is the founding step for a GPS-driven fare collection system that tracks commuters’ entry, movement and exit on state and national highways. Substantiating this vision for the transport sector with need to prevent crimes and tax evasions, he utilized the recent incident of a vehicle with gelatin sticks and explosive material that was found outside billionaire Mukesh Ambani as an example. It could be deduced where the vehicle came from and who was sitting in the car, findings that have led to much political uproar.

The FASTag can already track movement of vehicles, along with booth cameras that can detect law violations and commuters. Thus, it can identify and store such information that is unique to the vehicle owner and can be misused if in wrong hands given the interconnected nature of our growingly digital world. In 2019 alone, data of FASTag, that is linked to the National Vehicle Database (Vahan), was shared with 32 governmental and 87 private bodies, along with the Sarathi database (Nandi & Sharma, 2019).

The circumstances under which the government can utilize this information haven’t been codified and the Personal Data Protection Bill is still under review. This leaves people with little legal and regulatory backing to protect themselves against data breach. Though the introduction of FASTag has augmented total toll collection presently, certain ideas and perceptions of its future capabilities have opened Pandora’s box on ideas of privacy, state survaillable and the economic value of data.

– Ishita Puri (Guest Writer)

TYBA, St. Xavier’s College (Autonomous), Mumbai

Edited by: Saloni Vichare (Editor, Econ Declassified)


Alam, S. (2021, March 3). Gurugram: Snag takes heavy toll on FASTag operations. Times of India.

Naik, Y. (2020, February 6). FASTag glitches exact a heavy toll on wallets; authorities admit problems, but insist all is well now. Mumbai Mirror.

Nandi, S. (2020, November 15). What is fuelling the growth of FASTags. Mint.

Nandi, S., & Sharma, P. (2019, October 15). Will FASTag raise privacy concerns? Mint.

Press Trust of India. (2021, March 1). Mandatory FASTag to save ₹20,000 crore per anum on fuel: Nitin Gadkari. Mint.

Rupani, B. (2021, March 11). FASTag’s benefits and problems. Overdrive.

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