In order to provide support for credit transactions on the Unified Payments Interface (UPI), the National Payments Corporation of India (NPCI) has collaborated with payment aggregators such as Razorpay, Google Pay, and Paytm.
In an effort to combine the advantages of both, the Reserve Bank of India (RBI) linked RuPay credit cards to UPI in a bid to offer customers the instant payment experience of UPI with credit card rewards and short-term credit.
Customers no longer need to carry around their credit cards when making purchases because RuPay credit cards have been integrated with UPI. UPI users had access to only bank accounts, overdraft accounts, and savings accounts prior to this.
Because UPI’s network of asset-light UPI QR codes expands the places where credit-based payments are accepted, this action is anticipated to increase acceptance. This is advantageous for businesses in semi-urban areas where card point-of-sale terminals are less common.
Nalin Bansal, Chief of Corporate and Fintech Relationships and Key Initiatives at NPCI, stated that “we immediately started enabling leading payment aggregators to boost merchant acceptance and customer awareness in a bid to attract early and widespread adoption.” The RBI’s decision to link RuPay credit cards to UPI was made public.
With over 250 million unique users and five crore merchants on the network, UPI has grown into one of India’s most comprehensive payment systems. It can facilitate smartphone-based interbank transactions and manage payments in real time.
The RBI payments Vision for 2025 predicts that throughout the following four years, credit-based installment tasks will increment by 16% every year.
As India rapidly adopts digital payments for day-to-day transactions, the announcement of the credit card-UPI linkage is anticipated to provide access to a hassle-free and smooth payments experience for individuals and businesses alike.
Customers will be able to take advantage of credit-based payments when conducting business on the UPI network as a result of this move, which will further encourage the use of digital payment methods in India.
