Tech3 | NPCI sweetens deal for banks to lend on UPI; Drone-based land records get an AI boost; and more

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In today’s newsletter:?

• NPCI sweetens deal for banks to lend on UPI
• Drone-based land records get an AI boost
• Prime Focus ups VFX game in India with 'Kalki'

?NPCI sweetens deal for banks to lend on UPI

More lending opportunities for banks must be a no-brainer, especially on the most popular real-time payment network in the world, UPI.?

• But surprisingly, it wasn't an instant success!?

The National Payments Corporation of India (NPCI) is about to change that.

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What's happening?: NPCI is set to announce a 1.2% interchange fee for all pre-sanctioned Credit Lines on UPI - a pre-approved loan delivered directly through a user's UPI account. Let's break down what this means.?

• Interchange is a commission paid by merchants to the credit issuer bank. In simpler terms, banks earn money whenever a customer uses their Credit Line on UPI to make a purchase

• Additionally, third-party UPI apps like PhonePe and Google Pay might also get a small transaction fee

The product launched nine months ago, did not take off as there were no incentives for banks to offer it to customers. Until now!

Tell me more: The credit line on UPI is expected to offer multiple products from banks. These might include:

• An interest-free credit period similar to credit cards

• An overdraft-like product with interest charged from day one

• However, Credit line on UPI won't be available for person-to-person transfers

Credit cards have been the go-to option for instant credit. It remains to be seen if NPCI's new strategy will help Credit Line on UPI gain traction.

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