There was a time when a senior leader from the opposition party expressed his concern (in Rajya Sabha) on the feasibility of digital payments in India. After 5 years of his statement, India is now leading the world in terms of digital payment transactions. In 2020, Indians made 25.4 billion digital transactions which are 1.6 and 21 times more than China and the USA respectively. Looking at the success of digital transactions, the government decided to introduce a new digital payment system called e-RUPI. Since e-RUPI does not require a bank account, internet banking access, smartphone, and internet connection, we are hoping to witness deeper penetration of digital payment in India.
In this blog, we are going to discuss everything a common man of India should know about e-RUPI. So, let’s get started.
What Is e-RUPI
e-RUPI is a digital payment instrument developed for cashless payments. It is based on a QR code and SMS string-based e-voucher which will be delivered to the mobile of the users, upon request. One can redeem these vouchers without having a bank account or any third-party digital payments app.
National Payments Corporation of India (NPCI), the developing authority of UPI as well as e-RUPI announced that vouchers will be issued in two main categories i.e Person to Person (P2P) and Business to Consumer (B2C).
What Are Vouchers Exactly?
After the issuance of e-RUPI, it will be delivered to beneficiaries in the form of e-vouchers. E-vouchers will be sent via SMS. To make a payment, a beneficiary has to produce a QR code/string received in the SMS. Then, the authentication code will be shared with beneficiaries via SMS, and the code they have to share with merchants to complete the transaction.
Note, these e-vouchers will be either person or purpose-specific. For example, a voucher issued for medical expenses cannot be used for any other purpose.
Features Of e-RUPI
The following are the Features of e-RUPI:
- e-RUPI can be redeemed at government-sponsored medication centers
- Platform is prepaid
- No third-party service provider is required to process a transaction
- Will use the UPI platform as a base
- Developed by the National Payment Corporation Of India (NPCI), National health authority and Ministry Of Finance
- E-vouchers will be sent to the issuer’s mobile via SMS
- The maximum limit for each e-RUPI voucher will be 10,000 INR
- It will be non-transferable
- Cannot be redeemed in the form of cash or cashback
- The maximum validity of e-RUPI vouchers will be of one year
- Up to 10 vouchers can be issued from a single mobile number
- The issuer can track voucher redemption
- The platform ensures economic assistance provided by NGOs will be spent for the same purpose
Benefits Of e-RUPI
The following are the Benefits of e-RUPI:
- Doesn’t require a printout of the e-voucher. It is paperless
- The process to redeem an e-voucher is super easy
- Unlike UPI, your personal details will not be shared
- Users do not have a digital payment app can make use of this payment method
- The transaction can take place without a bank account
- 100% secure transaction. No chance of leakages.
- A transaction can be done contactless
- No need for a debit or credit card
- The issuer can track voucher redemption
- People who do not have a bank account can take advantage of digital transaction
- Can be used for health and family welfare in government hospitals
Banks Enabled With e-RUPI
Following is the list of banks that will be live with the facility of transacting e-RUPI:
|Name of the bank||Do they issue?||Do they acquire?||Name of the acquiring|
|State bank of India||Yes||Yes||YONO SBI Merchant|
|HDFC Bank||Yes||Yes||HDFC Business App|
|Axis bank||Yes||Yes||Bharat Pe|
|Bank of Baroda||Yes||Yes||BHIM Baroda Merchant Pay|
|ICICI bank||Yes||Yes||Bharat Pe and Pine Labs|
|Punjab National Bank||Yes||Yes||PNB Merchant Pay|
Recent Development On e-RUPI
As of July 2022, over 100 countries are planning to launch CBDC while 10 countries have already released, the first among the all was the Bahamian Sand Dollar in 2020 and the latest was JAM-DEX of Jamaica.
Last year Karnataka Government announced that they will employ e-RUPI to distribute education fees of students under scholarship programs to prevent leaks. Recently, the central bank indicated that they will soon start the pilot project on e-RUPI.
As a citizen of this country, and as a businessman these all were developments of e-RUPI you should be aware of. We know, just like us, you would be thinking that e-RUPI is a game-changer in digital payments as it is leak-proof. As a cloud accounting software vendor, we will keep posting the latest news from the government, financial institutions, and the market to keep you updated. Also, we want to reward you with a 60-day free trial of Munim as you have read this blog fully.
Frequently Asked Questions
How will the digital rupee is different from UPI
The Digital rupee will be a digital currency and it is said to be equivalent to legal tender while UPI is backed by digital alternatives of legal tender.
Is e-RUPI like bitcoin?
No, bitcoin is decentralized and there’s no governing body while e-RUPI will be regulated by NPCI. So, there is no risk involved in transacting or holding the same.
When will e-RUPI launch in India?
As of now, no particular date is announced by the stakeholders however, a pilot project has started and more updates are yet to be released.
What will be the maximum value of an e-RUPI voucher?
The maximum value of an e-RUPI voucher is said to be 10,000 and 10 such vouchers can be issued on a single mobile number.
Is e-RUPI based on blockchain technology.
No, e-RUPI will not rely on blockchain technology. It is based on UPI’s platform.
Can e-RUPI reduce corruption?
Yes, e-RUPI can reduce corruption to some extent because it can be issued for a particular purpose and makes direct benefit transfer easy.