Focusing on the need to integrate all retail payment systems under one umbrella, The Reserve Bank of India set up the Board for Payment and Settlement Systems in 2005, which eventually led to the formation of National Payments Corporation of India (NPCI). NPCI has been endorsed by RBI and currently has ten promoter banks namely, State Bank of India, Bank of India, Punjab National Bank, Canara Bank, Bank of Baroda, Union bank of India, ICICI Bank, HSBC, HDFC Bank, and Citibank.
Representing a miniature India in itself, the name RuPay, has been coined from two separate words namely, “Ru” from the Indian Rupee and “Pay” from payments. The RuPay card was introduced by NPCI in accordance to RBI’s vision of setting up a domestic payment system in India, which will allow Indian financial institutions to facilitate electronic payments across the country. With major competitors like MasterCard and Visa, RuPay has been trying to establish a strong foothold in the international market and is accepted on the Discover payment network owing to NPCI’s collaboration with Discover Financial Services (DFS).
Any RuPay card offers customers enhanced security in the form of an embedded EMV chip enabling high value transactions to be done with complete protection. Additionally, RuPay cards also carry an inbuilt microprocessor circuit containing information about the card owner. RuPay cards can be used at over 145, 270 ATMs on the National Financial Switch network and purchases can be made at over 875,000 Point of Sale terminals across India. Customers can also use RuPay cards for online transactions and purchases at over 10,000 web portals. NPCI has formed tie-ups with 29 major banks to enable PIN based PoS transactions via RuPay cards across various merchant outlets in India.
RuPay cards are still relatively new in the Indian market, but offer various benefits to card holders with superior customer service and higher levels of acceptance. NPCI offers RuPay cards at low processing fees along with instant SMS alerts for every transaction made by a customer.
1) RuPay cards help save cost:
Being a domestic payment system, all transactions will happen inside India leading to lower clearing and settlement cost for each and every transaction. Banks will benefit immensely from this as transaction costs will become very affordable, directly leading to increase in usage of RuPay cards across the country.
2) Customised for Indian consumers:
Made in India, for Indians! RuPay cards will be designed and manufactured to cater to the needs of Indians with maximum flexibility to customise the product and services offered.
3) RuPay transactions are secure:
Since all the card transactions take place within India, customers can rest assured that their personal information and data will remain inside the country, without the intervention of foreign organisations.
4) RuPay cards enables banks to tap into new consumer segments:
Financial institutions in India can use RuPay cards to introduce the electronic way of life to certain sections in India, where banking services are still unavailable. Rural areas will benefit from RuPay products as they are indigenous and also work to be very economical for banks planning to offer them to unexplored customer segments.
5) Products and Payment channels brought closer:
RuPay cards aim to connect various payment channels and products in India. Customers can access services like ATM services, banking transactions, e-banking services, requests for credit instruments, etc. using RuPay cards across different banking platforms.
6) Online payments with RuPay are quick and safe:
E-commerce transactions using RuPay cards can be done without any hassles and in a very secure manner. RuPay cards carry a two-tier authentication process as mandated by RBI, and offer protection against phishing and data logging. The online interface is also very user-friendly and processes card transactions at a very fast rate.
With RuPay debit cards having a successful run in the Indian market, NPCI has decided to launch RuPay credit cards in 2016. Anticipated to improve RuPay penetration in India, the organisation is of the thought that the credit cards will help tap into new segments across India. NPCI expects that the new RuPay credit card will rise to be a tough competitor for Visa or MasterCard services, which already have a well-established customer base in India. Currently, 13% of all transactions done at PoS terminals, ATMs and e-commerce websites are done using RuPay cards, with a steady rise in the number of transactions, every month.
RuPay credit cards will also be launched in the global arena with tie-ups with foreign institutions under the name, RuPay International. NPCI recently announced that financial institutions like JCB from Japan have tied up with RuPay to enable overseas transactions and China Union Pay is now in talks with the organisation to establish a collaboration soon. RuPay will also be contributing to the e-banking segment by providing various platforms for mobile banking and internet banking and will also facilitate the growth of e-retail payments in India.
Yes, RuPay has a Kisan card exclusively for farmers, enabling them to perform ATM and PoS transactions.
Unlike other payment channels, RuPay does not have a mandatory quarterly fee or joining fee to be paid by customers.
RuPay has partnership with private sector banks, public banks and rural as well co-operative banks. This is a huge advantage for RuPay customers as the reach of a RuPay card is quite high with tie-ups even with smaller banks across India.
Yes, RuPay cards can be used for cashless transactions anywhere across the globe.