Besides making the big but quite expected announcement of hiking repo rate by 50 bps amid inflationary pressure, the RBI has made another big move during today¡¯s MPC meeting announcements.?
For the first time, the RBI has proposed linking?credit cards to UPI. Until now, only the linking of savings or current accounts through debit cards of users was allowed for UPI.?
But the RBI has now stepped forward to deepen the reach and usage of UPI by allowing the linking of credit cards to UPI.
At present this move is a proposal by the RBI so we will have to wait and watch how this credit card to UPI linkage turns out. But just like debit cards are already allowed to be linked to UPI, credit card methods may be similar too.?
As per TOI, by adding a credit or debit card to UPI apps, you can make payments without having to swipe the cards at POS machine. Just scan a QR code and choose the added credit or debit card as the payment method to make the payment.
Once you initiate the payment through the UPI app using a debit or credit card, a one-time password (OTP) is sent to your registered mobile number to complete the payment. But remember that at present only Rupay cards will be enabled with this facility to begin with.
RBI statement said, ¡°UPI has become the most inclusive mode of payment in India. Currently, over 26 crore unique users and 5 crore merchants are onboarded on the UPI platform. In May 2022 alone, 594.63 crore transactions amounting to ?10.40 lakh crore were processed through UPI. UPI currently facilitates transactions by linking savings or current accounts through debit cards of users. The interoperability of PPIs has also facilitated access of PPIs to the UPI payment system for undertaking transactions. In order to further deepen the reach and usage, it is proposed to allow linking of credit cards to UPI.¡±?
The statement also clarified that to start with, Rupay credit cards will be enabled with this facility. This arrangement is expected to provide more avenues and convenience to the customers in making payments through the UPI platform. This facility would be available after the required system development is complete. Necessary instructions will be issued to NPCI (National Payments Corporation of India) separately. As per TOI,?other card networks like Visa and Mastercard will follow suit once the indigenous Rupay card is linked.
Speaking on this move, RBI governor Shaktikanta Das said ¡°UPI has become the most inclusive mode of payment in India with over 26 crore unique users and 5 crore merchants on the platform. In May 2022 alone, about 594 crore transactions amounting to ?10.4 lakh crore were processed through UPI. At present, UPI facilitates transactions by linking savings/current accounts through users¡¯ debit cards. It is now proposed to allow linking of credit cards on the UPI platform. To begin with, the Rupay credit cards will be linked to the UPI platform. This will provide additional convenience to users and enhance the scope of digital payments.¡±
Also Read:?Indian Crypto Investors Alarmed As Two Crypto Exchanges Block UPI Payment For Crypto Purchase
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