A campus card system is the software and hardware behind a student ID card that also opens doors, pays in the canteen and the campus shop, and borrows library books. The card carries a balance that students or their parents top up online. It is also called a smart ID card or a cashless campus system. The same card usually works for teaching and non-teaching staff.
The card has a small chip and an antenna inside. A reader picks up the card's number by radio when the card is held near it, without contact. This is a kind of RFID, the same idea as a FASTag on a car's windscreen. The card itself carries little more than its number. Everything else, such as the balance and the permissions, is kept in the campus card system.
Imagine a second-year student at a private university in Mohali. At 8:50 a.m., she holds her card to the reader at the academic block. The reader sends her card number to the physical access control system, which checks that she is a current student and opens the turnstile. At lunch, she buys a thali for ₹90 at the canteen. The canteen's point of sale (POS) software reads her card, and asks the campus card system to deduct ₹90 from her balance of ₹1,240. The new balance, ₹1,150, appears on the counter screen and in her app. On Sunday, her father in Bathinda adds ₹2,000 to her card by UPI, through the university's app.
The balance is prepaid money, like the balance in a digital wallet. So the university, or the company that runs the system, must account for every rupee that families have loaded and every rupee that has been spent. At the end of each day, the system pays each canteen and shop for what students bought with the card, minus any fee that they agreed. Because the balance can be spent only on the campus, the RBI treats it as a closed-system prepaid instrument, which does not need an RBI licence.
The card also controls permissions. A student's card may open a hostel only if she lives in it, and the chemistry lab only during her practical hours. The list of current students and their hostel rooms comes from the student information system (SIS). When a student graduates or reports her card lost, the system blocks the card number within minutes. After that, the old card cannot open any door or spend the balance.
Many Indian campuses still use the ID card only for identity, and accept UPI directly at each counter. A full campus card system is more common at universities in the United States, where payments on campus are run as a business of their own.