India Electronic Toll Collection Market, By Type (Automatic Vehicle Identification System, Violation Enforcement System, Automatic Vehicle Identification System, Others), By Technology (Radio Frequency Identification, Dedicated Short Range Communication, Global Navigation Satellite System, Video Analytics, Cell Phone Tolling, Others), By End User (Highway, Urban Area), By Region, Competition, Forecast & Opportunities, 2021-2031F

Market Overview

India Electronic Toll Collection Market was valued at USD 397.46 Million in 2025 and is expected to reach USD 726.89 Million by 2031 with a CAGR of 10.58% during the forecast period. The India Electronic Toll Collection market refers to the ecosystem of digital systems and technologies designed to automate toll payment across highways, reducing the need for physical transactions and manual toll booths.

At the core of this system is FASTag, a Radio Frequency Identification (RFID)-based solution mandated by the government, which allows vehicles to pass through toll plazas without stopping, thereby saving fuel, time, and reducing traffic congestion. The market is poised for significant growth due to the increasing adoption of cashless payment infrastructure, rising vehicular traffic, and the government’s push for intelligent transportation systems. National Highways Authority of India (NHAI) has aggressively rolled out FASTag infrastructure and aims for complete electronic tolling to curb revenue leakages and streamline operations.

Rapid growth in road development projects, particularly expressways and economic corridors, has accelerated the need for robust, scalable tolling solutions. Urbanization, increasing vehicle ownership, and the logistics industry's expansion have also contributed to the demand for efficient tolling systems. Integration with banking systems, real-time transaction monitoring, and data analytics features make electronic toll collection systems attractive to both operators and users. Technological advancements like GPS-based tolling and automatic number plate recognition are further expected to redefine the market landscape.

As India continues to prioritize digital mobility solutions, the electronic toll collection market is anticipated to grow steadily, supported by favorable regulatory policies, public-private partnerships, and continued infrastructure investments. The shift toward open-road tolling, which eliminates the need for physical toll plazas altogether, is also gaining momentum, reflecting the long-term vision of creating a nationwide digital highway network. With improved user experience, faster commute times, and better traffic management, electronic toll collection is set to become a critical pillar in India’s evolving transportation infrastructure, making it an indispensable tool for efficient road usage and economic productivity.

Key Market Drivers

Government Mandates and Policy Push for Digital Tolling

One of the most influential drivers for the India Electronic Toll Collection market is the aggressive policy push by the Indian government to enforce digital tolling across national and state highways. The government’s decision to make FASTag mandatory for all vehicles from February 2021 significantly accelerated the adoption of electronic toll collection systems. This mandate ensured a nationwide standardization of tolling infrastructure, reducing bottlenecks at toll plazas and curbing revenue leakages caused by manual cash transactions. The success of this implementation has led authorities to expand electronic tolling beyond national highways into urban expressways and private infrastructure projects, creating a more unified tolling ecosystem across the country.

The policy is not just about compliance—it’s also aimed at broader goals like enhancing ease of doing business and reducing fuel consumption from idling vehicles. With growing emphasis on smart mobility under government initiatives such as ‘Digital India’ and ‘Smart Cities Mission,’ electronic tolling has emerged as a foundational pillar for modern traffic management. State governments and municipal bodies are increasingly aligning with this digital agenda, rolling out pilot programs for automatic tolling on city bypasses, ring roads, and flyovers. These efforts are setting the stage for comprehensive, interoperable tolling systems that serve both commuters and commercial operators more efficiently. As of March 2025, over 97% of toll transactions on national highways are processed electronically, up from less than 25% in early 2019, according to National Highways Authority of India’s official toll reconciliation data.

Increasing Highway Network and Urban Infrastructure Projects

The rapid expansion of India’s highway and urban road infrastructure is directly amplifying demand for robust and scalable tolling solutions. Over the past decade, the government has heavily invested in constructing economic corridors, greenfield expressways, and urban link roads to support rising vehicular traffic. Each of these new routes necessitates an efficient and future-ready toll collection mechanism to handle high volumes without compromising on user convenience. As traffic density on Indian roads grows, especially on premium access-controlled highways, electronic tolling has become the only viable mechanism to prevent congestion and ensure consistent revenue flow for operators and authorities.

Public-private partnership (PPP) models that dominate new infrastructure development heavily rely on electronic tolling for cost recovery. With multiple tolling points often integrated within a single project, manual operations would result in excessive delays and disputes over fee collection. Electronic Toll Collection not only ensures faster clearance at plazas but also reduces the manpower and administrative costs associated with traditional systems. Infrastructure developers, recognizing the long-term cost efficiency of ETC, are embedding digital tolling systems at the planning stage of new road projects, indicating sustained demand well into the next decade. Between 2014 and 2024, India added over 60,000 kilometers of highways, with more than 500 active toll plazas requiring electronic tolling support across national and state roadways.

Surge in Private Vehicle Ownership and Road Travel Demand

India is witnessing a dramatic rise in private vehicle ownership, particularly in Tier I and Tier II cities, driven by increasing disposable incomes and greater access to financing options. This surge in vehicle population has led to a proportional increase in intercity and interstate travel, putting immense pressure on existing road infrastructure and toll collection systems. Manual toll collection has proven inadequate to handle peak-time traffic volumes, often resulting in long queues and travel delays. The Electronic Toll Collection system directly addresses these inefficiencies by enabling seamless passage, thereby improving overall commuter experience.

Post-pandemic travel behaviors have shifted in favor of personal mobility over public transport due to safety and convenience concerns. This change has led to a substantial increase in long-distance private travel, further intensifying the demand for efficient tolling mechanisms. With more cars on the road than ever before, users now expect contactless and quick toll payments as a default, not a luxury. As urbanization continues and more middle-class households acquire vehicles, the need for an integrated, countrywide ETC network becomes essential to avoid future gridlocks and operational inefficiencies at toll points. India’s vehicle population grew from 220 million in 2016 to over 370 million by 2023, according to official data from the Ministry of Road Transport and Highways.

Technological Advancements and Interoperable Platforms

Technological evolution in India’s transport and fintech sectors has significantly elevated the capabilities of electronic tolling platforms. The integration of cloud computing, artificial intelligence, and machine learning into ETC systems is enabling real-time analytics, fraud detection, and adaptive toll pricing. These advancements are not only enhancing toll plaza performance but also supporting authorities in planning future infrastructure through data-driven insights. The use of GPS-based tolling and Automatic Number Plate Recognition (ANPR) is also gaining traction, setting the groundwork for completely barrier-free open-road tolling in the future.

The interoperability of ETC systems across multiple banks, payment gateways, and platforms ensures a seamless experience for users. The National Payments Corporation of India has worked with banks and digital wallets to enable FASTag top-ups and transactions through Unified Payments Interface, further boosting user convenience. As India continues to digitize its highway ecosystem, the expansion of such technologies will support not just tolling, but also traffic management, accident reporting, and smart city integration. The convergence of transport and digital payments will create a resilient and scalable ecosystem capable of supporting India’s infrastructure ambitions. As of early 2025, over 7 crore FASTags have been issued in India, with more than 400 banks, mobile apps, and payment platforms offering top-up and recharge support.

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Key Market Challenges

Infrastructure Disparities and Operational Inconsistencies Across Regions

One of the critical challenges facing the India Electronic Toll Collection market is the significant infrastructure disparity across various regions. While metropolitan and Tier I regions benefit from high-quality toll plazas equipped with modern sensors and well-maintained electronic infrastructure, many remote and Tier III locations continue to face underdeveloped facilities, frequent technical malfunctions, and limited access to consistent internet connectivity. This uneven technological landscape undermines the national goal of establishing a unified electronic tolling system, causing inefficiencies, especially when vehicles move between digitally enabled and manually operated toll zones. These disparities not only create confusion for vehicle owners but also discourage them from fully transitioning to electronic toll mechanisms, defeating the core purpose of automation and efficiency.

Operational inconsistencies arise due to the varied capabilities and practices of toll operators across different states and highways. Instances of incorrect deductions, double toll charges, and failed transactions have created distrust among users. Inconsistent enforcement of electronic tolling mandates at private or state-level roads poses a regulatory challenge. While the National Highways Authority of India has achieved a high rate of digital tolling compliance, several regional bodies still permit hybrid operations, leading to unpredictable user experiences. Without a standardized national framework for equipment quality, service level agreements, and grievance redressal mechanisms, the reliability and credibility of electronic tolling remain under scrutiny for a large section of the commuting population.

Limited Digital Literacy and Resistance from Road Users

Despite increasing adoption, a sizable portion of the Indian driving population continues to face challenges in navigating electronic toll systems due to limited digital literacy. In many parts of the country, particularly rural and semi-urban areas, drivers—especially those in commercial fleets or small transport businesses—lack the technological familiarity to manage account recharges, monitor balances, or resolve transaction issues. This digital gap creates dependency on agents or middlemen, often leading to errors or misinformation. For instance, drivers unaware of recharge processes may encounter unexpected deductions or penalties, leading to dissatisfaction with the system. This technological unfamiliarity not only slows adoption but also adds an operational burden to toll authorities, who must handle more offline support and grievance redressals.

In addition to knowledge barriers, there is also behavioral resistance from users accustomed to cash payments. Many vehicle owners prefer direct, tangible exchanges over digital alternatives, citing transparency concerns or skepticism toward online systems. This resistance is more pronounced among older drivers and in regions where banking penetration is low. Furthermore, fear of surveillance and transaction tracking deters certain sections of the population from embracing electronic tolling. These psychological and educational hurdles collectively slow down the pace of digital transition, despite government mandates and incentives. Addressing this challenge will require targeted awareness campaigns, on-ground training support, and simplification of user interfaces across recharge and grievance platforms to make electronic tolling more accessible and trusted.

Key Market Trends

Transition Toward Barrier-Free Open Road Tolling

A prominent trend shaping the India Electronic Toll Collection market is the strategic shift toward barrier-free open road tolling, which eliminates the need for physical toll booths altogether. This advanced system leverages technologies such as Global Positioning System-based tolling, Automatic Number Plate Recognition cameras, and real-time data analytics to calculate toll charges dynamically based on distance travelled or vehicle classification. The objective is to replace traditional toll plazas with virtual checkpoints, enabling vehicles to maintain cruising speeds and enhancing fuel efficiency. This approach is already being piloted on select expressways, and its implementation aligns with India’s vision for smart and sustainable infrastructure. In addition to decongesting toll points, this trend supports better air quality by minimizing idling and fuel waste. It also facilitates more transparent toll calculation and real-time enforcement, reducing the scope for evasion. As the technology matures and more highways become digitized, open road tolling is expected to become the standard model for toll collection in India, revolutionizing how mobility infrastructure is managed.

Integration of Tolling Data With Smart Mobility and Logistics Platforms

Another significant trend in the India Electronic Toll Collection market is the increasing integration of tolling data with broader smart mobility and logistics management platforms. Toll transaction records are no longer limited to revenue collection—they are becoming vital inputs for vehicle tracking, route optimization, predictive maintenance, and traffic forecasting. Fleet operators now use Electronic Toll Collection data to monitor the efficiency of their routes, analyze toll expenditure, and align vehicle deployment with time-based traffic trends. Moreover, urban mobility planners and government agencies are beginning to incorporate this data into smart city initiatives to manage congestion and plan infrastructure improvements. This convergence of electronic tolling and smart mobility analytics is transforming toll systems into multifunctional infrastructure layers. As a result, the Electronic Toll Collection ecosystem is gradually evolving from a transactional framework into a strategic data asset that informs broader transport policy, traffic management, and sustainability goals across the country.

Segmental Insights

Type Insights

In 2025, the Automatic Vehicle Identification System segment dominated the India Electronic Toll Collection market and is expected to maintain its leading position throughout the forecast period. This dominance is primarily driven by the widespread adoption of radio-frequency identification-based technologies, particularly FASTag, which enables seamless and contactless toll payment. The system's efficiency in recognizing vehicle identity, class, and ownership details without requiring vehicles to halt at toll plazas has significantly improved traffic flow and operational productivity across national highways.

Its integration with banking networks, mobile applications, and the National Payments Corporation of India’s digital framework has further streamlined toll transactions. As more highways, urban expressways, and municipal roads transition to automated toll systems, the need for accurate and reliable vehicle identification technology is expected to increase. Additionally, government mandates and the growing push for open road tolling reinforce the long-term growth trajectory of the Automatic Vehicle Identification System segment.

Technology Insights

In 2025, the Radio Frequency Identification technology segment dominated the India Electronic Toll Collection market and is anticipated to retain its dominance during the forecast period. The success of this segment is primarily attributed to the nationwide implementation of FASTag, which utilizes passive Radio Frequency Identification tags for automatic toll payments. Supported by a centralized infrastructure and regulatory mandates from the government, Radio Frequency Identification has become the standard for vehicle identification and transaction processing across all national highways and many state-level toll roads.

Its benefits—such as low-cost deployment, high accuracy, minimal maintenance, and real-time data transmission—have made it the preferred choice for both public and private toll operators. Its seamless integration with banking systems and mobile applications enhances user convenience and ensures scalability. As the government moves toward a unified, barrier-free tolling network, Radio Frequency Identification is expected to remain at the core of India’s electronic tolling architecture.

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Regional Insights

South India held the largest market share in 2025 and continues to dominate the Indian Electronic Toll Collection market due to its robust transportation infrastructure and early adoption of digital tolling technologies. States like Tamil Nadu, Karnataka, and Telangana have aggressively invested in developing expressways, national highways, and ring roads, all of which have been rapidly integrated with electronic tolling systems such as FASTag. The presence of high vehicle density, especially in urban centers like Bengaluru, Chennai, and Hyderabad, has driven demand for faster, more efficient toll collection mechanisms, minimizing congestion and maximizing throughput at toll plazas.

Another contributing factor is the progressive stance of state transport and infrastructure authorities in South India, who have collaborated actively with central agencies like the National Highways Authority of India to implement standardised, interoperable tolling systems. Many public-private partnership infrastructure projects in the region include electronic tolling as a default component, ensuring higher compliance and reducing manual intervention. This alignment between regulatory frameworks and infrastructure execution has played a key role in strengthening market dominance.

South India's population demonstrates relatively higher digital literacy, banking penetration, and smartphone usage, which supports the widespread use and management of electronic toll accounts. The ease of accessing recharge platforms, automated balance updates, and real-time transaction visibility has led to high adoption rates among commuters and fleet operators alike. With upcoming infrastructure projects such as greenfield corridors and elevated expressways already being planned with end-to-end digital tolling integration, South India is well-positioned to sustain its leadership in the Indian Electronic Toll Collection market over the coming years.

Recent Developments

• In September 2024, Neology acquired P Square Solutions, a tolling services company with a U.S. base and an office in Kochi, India. This acquisition formed the new division "Neology PSquare," enhancing Neology’s tolling capabilities and strengthening its presence in India through local technical support and expertise in hardware, software, and back-office systems.
• In November 2024, Kapsch TrafficCom announced its role in India’s satellite tolling exploration. Using GPS and Galileo data, the system offers real-time, distance-based vehicle charges to reduce urban congestion and pollution. The Ministry of Road Transport and Highways is advancing this initiative, with Kapsch TrafficCom as a key contributor to its implementation.
• In January 2024, Conduent was selected by the Oklahoma Turnpike Authority to support the state’s shift to a cashless tolling system using PlatePay. Conduent’s technology retrieves vehicle registration data to invoice motorists without transponders, reflecting a broader cashless tolling trend that may inspire similar advancements in India’s tolling infrastructure.

Key Market Players

• Neology, Inc.
• Conduent Incorporated
• Cubic Corporation
• Tata Consultancy Services Limited
• Wipro Limited
• HCL Technologies Limited
• Siemens AG
• Thales Group

Report Scope:

In this report, the India Electronic Toll Collection Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• India Electronic Toll Collection Market, By Type:

o   Automatic Vehicle Identification System

o   Violation Enforcement System

o   Automatic Vehicle Identification System

o   Others

• India Electronic Toll Collection Market, By Technology:

o   Radio Frequency Identification

o   Dedicated Short Range Communication

o   Global Navigation Satellite System

o   Video Analytics

o   Cell Phone Tolling

o   Others

• India Electronic Toll Collection Market, By End User:

o   Highway

o   Urban Area

• India Electronic Toll Collection Market, By Region:

o   South India

o   North India

o   West India

o   East India

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the India Electronic Toll Collection Market.

Available Customizations:

India Electronic Toll Collection Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).

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