PM Modi Launches Digital Payment Solution e-RUPI, Here’s What Financial Services Industries Think About the Move

Prime Minister Narendra Modi unveiled India’s digital payment solution e-RUPI, which is a cashless and contactless instrument for payment of cash through the electronic mode. PM Modi said that the e-RUPI voucher is going to play a huge role in making Direct Benefit Transfer (DBT) more effective in digital transactions in the country and will give a new dimension to digital governance. This initiative is aimed at providing everyone a targeted, transparent and leakage free delivery.

“India is showing the world today that they are second to none in adopting technology and connecting with it. When it comes to innovations, use of technology in service delivery, India has the ability to give global leadership along with big countries of the world,” said PM Modi. He also added that if any organisation wanted to help someone in their treatment, education or for any other work, then they will be able to give an e-RUPI voucher instead of cash, which will ensure that the money given by them is used for the work for which the amount was given.

What the Financial Services Industries Feel About e-RUPI

The industry has largely appreciated the move but has also suggested that stronger controls may be required to ensure no fraud takes place. “The new digital payment mode, e-RUPI, is basically a prepaid voucher that can be issued directly to citizens after verifying mobile number and identity. e-RUPI voucher will be delivered in the form of a QR code or SMS string-based e-voucher to the beneficiary’s mobile number. The beneficiary can redeem the voucher without a card, digital payments app or internet banking access, at the service provider. This would be very useful instrument for those who are not privy to use to the digital platform yet the government can extend monetary support in digital form directly to citizens in a “leak-proof manner” in the form of prepaid e-voucher powered by UPI,” said Bharat Panchal, CRO  - APAC, Middle-east and Africa, FIS.

“However, some stronger controls may be required to monitor any possible frauds.  If real beneficiary starts encashing such vouchers in lieu of cash than it would be difficult to trace such pre-paid instruments once it start to move from one hand to other.  Therefore , It would be very effective to match the beneficiary’s details at the time of redemption to make sure that real beneficiary only is using it and not someone else,” he added.

Anand Kumar Bajaj, founder and CEO, PayNearby, said: “This is the next best step to take high end of tech to bottom of pyramid. It will help the Government to dispense the specific policy benefit to an identified user segment without any misuse of the funds or delay. The funds will not need to move around in banks but the beneficiary can directly go to end point to avail the intended benefit. Beyond a code sending to mobile number of a user, I believe the upgrade can also scan an Aadhaar card at the dispensation counter and identify the user for the respective service. This is the true test of network that has been created at the last mile in India. Targeted, transparent and leakage free delivery to the end point is the intention of policy maker. The Central Bank Digital Currency movement has already started by India now. While the world is talking of Central Bank Digital Currency, India has already launched it today.”