Shaktikanta Das, governor of the Reserve Bank of India (RBI), introduced the Rupay credit card via the Unified Payments Interface (UPI) network on Tuesday. According to analysts, this may potentially increase the market for credit by nearly five times. Currently, debit cards and bank accounts are used to link UPI. One may now connect their Rupay credit cards as well. Customers of Punjab National Bank, Union Bank of India, and Indian Bank will be the first to benefit from the integration of the RuPay credit card on UPI.
“Customers will benefit from the increased opportunity to use their credit cards, and merchants will benefit from the increase in consumption by being part of the credit ecosystem with the acceptance of credit cards using assets like QR codes. RuPay credit cards will be linked to a Virtual Payment Address (VPA) i.e. UPI ID, thus directly enabling safe, and secure payment transactions. The initial phase of operationalisation will be centred on extracting actionable learnings that would be used to fine-tune the proposition in later phases to scale up the usage,” the National Payments Corp Of India (NPCI) said in a statement.
NPCI further said,”Together, the RuPay credit card on UPI, UPI LITE, and Bharat BillPay Cross-Border Bill Payments initiatives gives the potential to revolutionise the digital payments ecosystem and extend the reach of digital payments to many new users across India and abroad and aid the journey of onboarding the next 300 mn users on digital payments,”
UPI payments have increased in the last two years and post covid the payment rates have also increased. As of July 2022, 338 banks are operational on the UPI platform. UPI transactions climbed from 9.83 lakh crore in April of this year to 10.73 lakh crore in August, according to the RBI’s monthly data.