The government plans to make FASTag mandatory for availing third party vehicle insurance effective from April 1, 2021. The transport ministry may also make FASTag mandatory for all public and private vehicles sold before December 1, 2017 with effect from January 1, 2021.

The ministry had earlier made FASTag mandatory for all vehicles from December 1, 2019.

"As per Central Motor Vehicles Rules, 1989, since 2017 the FASTag had been made mandatory for all registration of new four wheeled vehicles and is to be supplied by the vehicle manufacturer or their dealers. It is now proposed to make FASTag mandatory in old vehicles also i.e. M and N category of motor vehicles (four wheelers) sold before December 1, 2017, through amendments in CMVR, 1989. This is proposed to be put in force w.e.f. January 1, 2021," the road transport ministry's draft notification said.

FASTag is an electronic toll collection system, operated by the National Highway Authority of India (NHAI). It employs Radio Frequency Identification (RFID) technology for making toll payments directly from the prepaid or savings account linked to it or directly from the toll owner. It is affixed on the windscreen of the vehicle and enables drivers to pass through toll plazas without stopping for transactions.

Meanwhile, the government recently made the use of radio-frequency identification device (RFID) FASTag mandatory for availing any discount or any other exemptions in toll charges, including return journey within 24 hours. "The fee payable towards such discounts shall be paid through pre-paid instruments, smart card or through FASTag or on board unit (transponder) or any other such device only," the road transport ministry had said.