- Why in news
- On 20 February 2026, the Road Transport Ministry said NHAI is considering ending cash payments at all National Highway fee plazas from 1 April 2026. Only FASTag or UPI would be accepted.
- What it is
- The National Highways Fee (Determination of Rates and Collection) Rules, 2008 set how user fee (toll) is fixed and collected on national highways, permanent bridges, bypasses and tunnels. They are framed under the National Highways Act, 1956. The rules fix fee by vehicle type and are amended from time to time, including the penalty for entering a lane without valid FASTag.
- Penalty for no valid FASTag, paying cash
- A vehicle without a valid, functional FASTag pays twice the applicable user fee if it pays in cash.
- UPI rate
- A user without FASTag who pays by UPI is charged 1.25 times the user fee for the vehicle category.
- FASTag penetration
- FASTag penetration is over 98 percent. It uses RFID tags fixed on vehicles.
- Scale
- The change would cover over 1,150 fee plazas on National Highways and Expressways.
- Legal basis
- The fee rules are made under the National Highways Act, 1956.
- Change made
- On a National Expressway not open end to end, the completed length will be charged at the lower National Highway rate.
- Earlier position
- Expressway fee was 25% above the normal National Highway fee, even for a partly completed expressway.
- Name of amendment
- It is titled the National Highways Fee (Determination of Rates and Collection) (Amendment) Rules, 2026.
- Stated aim
- To push traffic onto the opened expressway stretches and decongest parallel old highways, speeding up logistics and cutting pollution.
- Parent law
- The 2008 Rules are made under the National Highways Act, 1956, administered by the Ministry of Road Transport & Highways.
Don’t confuse with FASTag vs UPI payment: FASTag is a prepaid RFID tag that debits automatically. UPI is a mobile instant payment system used at the plaza by those without FASTag.
Don’t confuse with NHAI vs Ministry of Road Transport and Highways: NHAI implements the toll plan. The Ministry frames the policy and the fee rules.
Don’t confuse with National Highway vs National Expressway fee: Expressways are access-controlled and normally carry a fee 25% higher than normal National Highways. The cut applies only to the completed length of a partly open expressway.
Don’t confuse with Fee Rules 2008 vs National Highways Act 1956: The Act is the parent law. The Rules are delegated legislation framed under it that set fee rates and collection.
Laws, judgments and statutory bodies: 30 Prelims questions since 2013 (what the law says, who chairs, legal basis). In Mains, 44 news-triggered questions, most in GS2, asking for provisions and challenges.
Why it matters
- Cuts queues and delays, and lowers fuel use and disputes at plazas.
- Brings more transparency and traceable toll transactions, and supports digital payment adoption.
- Aligns the toll with the service actually delivered on an unfinished expressway.
- Can shift traffic from congested old highways to new stretches, helping logistics and lowering pollution.
Problems
- Users without a working FASTag, or without smartphones or network, may face difficulty, especially in remote areas.
- Tag failures, wrong deductions and poor connectivity at plazas can cause new disputes.
- The relief is temporary, lasting up to one year or until full opening, and may cost toll revenue.
- Concessionaires and operators may need compensation or revised revenue assumptions.
Way forward
- Keep reliable UPI and FASTag support at plazas, with quick grievance redress for wrong deductions.
- Move toward barrier-free tolling and publicise the change well before the date.
- Complete expressway stretches on schedule so the interim rate is needed for a short period.
- Keep toll rules transparent and publicly notified so users know which rate applies.
Put in your answer
FASTag penetration: FASTag penetration is over 98 percent, so most toll payments are already electronic.
Plaza-level problems with cash: Plaza assessments link cash payments to congestion, longer waits at peak times and disputes.
Toll policy example: The amendment links the toll rate to the stretch actually opened on a partly operational expressway, an example of user-fee rationalisation.
UPSC’s own questions that come close to this issue, from our Prelims and Mains banks.
Prelims practice · Single answer
Ours, not from a UPSC paper
Consider the following statements about toll collection on National Highways in India:
Which one of the following is correct?
True or false?
1 of 4
Statements the way Prelims prints them. Say first, then see the fact.
1.Under the National Highway fee rules, a vehicle without a valid FASTag that pays in cash is charged twice the applicable user fee.
True. Cash payment without valid FASTag attracts 2 times the fee.
2.FASTag works on Radio Frequency Identification (RFID) technology.
True. FASTag is an RFID-enabled tag affixed to vehicles.
3.The National Highways Fee (Determination of Rates and Collection) Rules, 2008 are framed under the National Highways Act, 1956.
True. The rules derive from the National Highways Act, 1956.
4.The Unified Payments Interface (UPI) is operated by the National Payments Corporation of India (NPCI).
True. NPCI runs UPI.
Written by us from the release, not by UPSC; checked by a second model.
Worth revising until Prelims 2027: most news questions come within two years of the event.