RBI Governor Launches UPI-Linked RuPay Credit Card, UPI Lite
Three new modes of payment: RuPay credit cards on UPI, cross-border transactions for Bharat Bill Payment System and UPI Lite.
RBI Governor Shaktikanta Das launched a RuPay credit card linked to the Unified Payments Interface to further deepen the reach of cashless transactions in India.
Das also rolled out UPI Lite—for low-value transactions using an on-device wallet—at the Global Fintech Festival on Tuesday in Mumbai. And he unveiled cross-border payments for Bharat Bill Payment System, allowing non-resident Indians to pay recurring bills while living overseas.
Digital payments have exploded in India since the launch of UPI, a real-time mechanism allowing cash transfer across banks and financial service providers.
The RuPay credit card linked with UPI will further improve penetration in rural and semi-urban areas, Biswamohan Mahapatra, chairman of the National Payments Corporation of India, said at the launch. "If you go to rural, semi-urban areas, you can’t find a [point-of-sale] machine," he said, emphasising that UPI will now aid credit card usage in non-metro areas.
Nandan Nilekani, Infosys Ltd.'s co-founder, who has advised the central bank on digital payments, said UPI-linked RuPay credit cards is the first step towards enabling more credit availability on UPI.
And UPI Lite, according to Nilekani, "reduces the pressure on banking systems". It's likely to make traditional UPI more efficient as the load on banks' core system diminishes, he said.
Eight banks are currently live with UPI Lite, including HDFC Bank Ltd., Kotak Mahindra Bank Ltd., State Bank of India and Union Bank of India.
Focus On Credit Delivery, Risk Mitigation: Das To Fintechs
"In India, one of the most transformative roles that can be played by fintech is in the area of credit delivery in partnership with traditional lenders, especially in rural and semi-urban areas," Das said, while speaking at the launch.
Acknowledging that fintechs help enhance efficiency and reduce costs, he said the ecosystem should also pay higher attention to risk mitigation, governance and compliance.
Das said the RBI is also working on a phased rollout of India's central bank digital currency. "This is expected to give further fillip to the digital ecosystem."