Democratizing the digital payments ecosystem

During the ongoing global fintech festival, RBI & NPCI announced the following three critical digital payments initiatives for India:

• Rupay Credit Card on UPI
• UPI Lite
• Bharat BillPay Cross-Border Bill Payments

These measures will enable India to expand its already vast ecosystem of the digital payments. We saw exponential growth in the use of UPI over the last 2-3 years; with these progressive steps in the digital ecosystem, I firmly believe that the subsequent 300 million UPI users will be added in less time than the first 300 million. NPCI isn't following the "If it ain't broke, don't fix it approach" and instead pushing the envelope of innovation further in digital payments.

Rupay Credit Card on UPI: India, a young nation, relies a lot on domestic credit users to increase the liquidity in the system. To date, UPI was linked to the bank account (or debit account); hence, the pie was limited to the value of the deposits in the banks. But now, customers will benefit from the increased opportunity to use their credit cards, and merchants will benefit from increased consumption by being part of the credit ecosystem. NPCI has taken a sandbox approach to test what works and will later fine-tune it depending on its use.?

UPI Lite: Many of us have been in situations where we had to pay Rs 20 for a pack of chips but didn't carry cash. As I had talked about in one of my previous articles, the use of UPI is so widespread that it's not the big transactions but low-value transactions that are most common in our day-to-day lives. In fact,?"50% of transactions through UPI are below Rs 200". With UPI Lite, RBI intends to provide users with convenient, faster and simpler low-value transactions. This will also reduce the debit load on the core banking system, thus improving the success rate of transactions. Intended to work as an offline mobile wallet platform, it won't require a UPI pin given the low-value transaction.

Bharat BillPay Cross-Border Bill Payments: With more than 30 million residents staying abroad, India is one of the top 5 biggest recipients of inward remittance. Cross-border bill payments will empower & enable NRIs to undertake utility, water, and other bill payments on behalf of their families in India.