The National Highways Authority of India (NHAI) has announced a compensation plan to balance revenue losses drawn by toll operators following the introduction of the FASTag Annual Pass for private non-commercial vehicles, effective August 15, 2025.
Under the new scheme, vehicle owners can purchase an annual pass priced at Rs 3,000, granting them up to 200 toll-free crossings within a year. This initiative aims to consolidate toll payments and reduce traffic jams at toll plazas. However, the shift to annual passes has led to concerns about potential revenue shortfalls for toll operators, as fewer vehicles may pay the standard toll fees.
To address this, NHAI will provide compensation to toll operators for any revenue shortfall over a three-month period, starting from August 15. The compensation will be based on actual transaction data provided by the National Payments Corporation of India (NPCI) through the Indian Highways Management Company Limited (IHMCL). This data will regulate the number of vehicles using the annual pass at each toll plaza.
The compensation mechanism is designed to cover existing contract agreements and will also apply to bids invited in the next three months. After this period, bidders will be informed about the annual pass usage figures and will be required to account for them in future bids. No further compensation will be provided beyond this adjustment period.
Additionally, the compensation is capped at two one-way annual pass transactions per vehicle per day at a single toll plaza, even if the same vehicle crosses multiple times in a day. This measure aims to standardize the compensation process and prevent potential misuse.
NHAI’s decision to implement this compensation plan reflects its commitment to ensuring a smooth transition to the new tolling system while maintaining the financial stability of toll operators. The agency has underscored that the mechanism will be reviewed after three months based on the collected data to assess its effectiveness and make necessary adjustments.
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