RBI Governor Shaktikanta Das said on Thursday that the Unified Payments Interface (UPI) will be linked to pre-approved credit lines of banks. At the same time, RBI and National Payment Corporation of India (NPCI) are also discussing with many countries for UPI arrangement. This will increase the footprint of Unified Payments Interface (UPI). The RBI governor said this during the press conference of monetary policy on Thursday.
2 months ago PM Narendra Modi and PM of Singapore Lee Hsien Loong launched cross-border payment connectivity between India and Singapore. For this, UPI has been linked to PayNow in Singapore. People of both countries can transfer money instantly (real time) through QR code or mobile number linked to their bank accounts. This service is available 24x7.
The RBI governor also proposed to expand the scope of UPI by allowing operation of pre-approved credit lines by banks through UPI. That is, in a way you will have a digital credit card which you will be able to use through UPI.
According to Shivaji Thapliyal, research head and lead analyst at Yes Securities, banks will now be able to offer digital credit cards instead of physical ones. There will also be no need for expensive physical acceptance infrastructure like POS/swipe machines.
Customers will not have to carry separate cards. You will be able to pay through UPI from your mobile only.
Time will be saved. It takes some time to get a credit card. Credit line will be available immediately after approval.
The point-of-purchase credit experience will become seamless. This can bring transformational growth in the BNPL sector.
With the launch of UPI in 2016, there was a revolution in the world of digital payments. UPI gave the facility to transfer money directly to the bank account. Earlier there was a trend of digital wallet. There is a hassle like KYC in the wallet, while nothing has to be done in UPI. Penau is a payment system similar to UPI developed by the Association of Banks in Singapore
The operation of RTGS and NEFT payment systems in India is with the RBI. National Payment Corporation of India (NPCI) operates systems like IMPS, RuPay, UPI.
UPI system provides real time fund transfer. Multiple bank accounts can be linked in one application.
To send money to someone, all you need is their mobile number, account number or UPI ID.
UPI has been developed on the model of IMPS. That's why you can do 24x7 banking through the UPI app.
Online shopping with UPI does not require OTP, CVV code, card number, expiry date etc.
