Sunday, April 10, 2016

MasterCard CEO Ajay Banga calls for equal treatment with RuPay domestic card



MasterCard CEO Ajay Banga has called for equal treatment with the RuPay domestic card, particularly with regard to the government's flagship financial inclusion scheme on criteria such as security and cost advantages. "All I want is a level playing field," he said in an interview when asked about RuPay being used for the Pradhan Mantri Jan Dhan Yojana. "What I (MasterCard) can do is offer you global standards of safety and security. I don't believe any local instrument or scheme can..."
"I can bring all the expertise, manpower. You happen to have a CEO, an Indian by birth," Banga said. He said global investment sentiment on India had turned positive after the Narendra Modi government took over in 2014. "People today are talking India being a real opportunity," he said.
Much of this is because the government has sought to actively create an investor-friendly environment that eschews an aggressive tax policy, but the speed of reform needs to increase. "Retroactive taxation has single-handedly created the most angst in people's minds. So the biggest challenge is predictability and consistency of public policy," he said. "But now, while policy is clearer and more predictable, and frankly more transparent, the actual pace of implementation is choppy. The one thing we are keen on is increasing the pace of this implementation over four-five years."
What's needed is further clarity on taxes and intellectual property, besides market access. "India doesn't allow overseas law firms. It's all these ancillary services that enable an environment where investors feel comfortable to come in," he said. MasterCard has invested.`1,600 crore in India since Modi took over, he said.

RuPay, Indian payment company working on ‘contact-less’ debit card

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Domestic payment gateway RuPay, whose debit cards make up more than a third of the total number of debit cards in the country, is now working on a "contact-less" debit card...

Domestic payment gateway RuPay, whose debit cards make up more than a third of the total number of debit cards in the country, is now working on a “contact-less” debit card and is looking to launch it within three months, chief operating officer Dilip Asbe told FE.
“Contact-less” debit card will not be required to be dipped or inserted into a machine, and can instead be scanned by the machine without any physical contact whatsoever, unlike the debit and credit cards in play currently.
“We are very excited about this. Of course, we will have to issue fresh certifications to banks to enable them to start issuing these. But so far, we have received extremely positive feedback,” Asbe said.
Started by the National Payments Corporation of India (NPCI) in 2012, the number of RuPay cards is around 250 million, of the total of 644 million debit cards currently in use in India. This is primarily because of the Pradhan Mantri Jan Dhan Yojana, under which around 170 million RuPay cards were distributed.
NPCI has also issued around 2 million RuPay platinum cards so far. Unlike other gateways, all variants of the RuPay platinum card offer a waiver on fuel surcharge, IRCTC surcharge and free access to lounges across a wide network of airports around the globe. The product has been growing in popularity and will be one of the main focus points for the company going ahead, Asbe said.
The company is now looking forward to launching RuPay credit cards in September, and is aiming at gaining a share of around 10% of the domestic credit card market within the first three years.
As on December 31, the total number of credit cards in India stood at over 22.7 million, issued by 29 banks.

Sunday, March 13, 2016

NPCI To Launch RuPay Credit Card By July

NPCI to Launch RuPay Credit Card by July

The National Payments Corporation of India (NPCI) has said it will launch a RuPay credit card by June or July this year. "By June or July we will rollout RuPay version of credit cards," said NPCI chairman M. Balachandran on the margins of a Unified Payment Interface (UPI) hackathon the umbrella organisation for retail payments in the country organised.

He later said the NPCI has escalated its paid-up capital to Rs.137 crore from Rs. 100 crore by broad-basing its stakeholders from public and private sector banks as well.

As many as 56 different banks have shareholding in NPCI despite it being a non-listed entity with no dividend declarations.

"Ours is a non-profit company, and in spite of not being a listed entity and we don't declare dividends, the enthusiasm shown by people to become shareholders in NPCI has been tremendous," said Balachandran.

According to him, there are 241 million RuPay cards in circulation comprising 35 per cent of the total card base in India and accounting to 20 percent of all card-based transactions.

Starting September, China Union Pay and Japan Credit Bureau (JCB) foreign cards will be accepted in India, said Balachandran.

Speaking on the UPI hackathon, NPCI honorary advisor and former Infosys chief executive Nandan Nilekani said banks can use digital footprint to give customers a loan.

"As more and more payments become digital, it creates a digital footprint of your activity and you (customer) can authorise a bank to use your digital footprint to give you a loan," he said.

Tuesday, February 9, 2016

NPCI aims at financial inclusion: Rupay Card News



Aiming at financial inclusion for all with India's domestic card service RuPay, the National Payments Corporation of India (NPCI) said that as many as 170 million of its 230 million customer base were first-time card users.



"We already have as many as 596 members who are in the RuPay network, including national, international and state cooperative banks. We are now trying to get the district central cooperative banks (DCCB) also in the fold," says A P Hota, managing director and CEO of NPCI.



RuPay also helps curb forex loss. For every transaction involving foreign card providers like Visa, MasterCard, American Express, there is the transaction fee on it going out of the country - an estimated 400 crore annually. "With a domestic card service system, there is a tremendous amount of money that India can retain," says M Balachandran, chairman, NPCI.



Another advantage with using RuPay over international card providers for a consumer is when it comes to the merchant discount rate (MDR) - the rate charged by banks providing debit and credit card services to merchants. So normally a food bill of Rs 2,000 or a saree purchase of Rs 4,000 will result in a Rs 20-Rs 40 deducted as MDR.



"With RuPay, the advantage is that we charge a fixed rate. We charge 60 paise on the acquirer bank and 30 paise on the issuer bank - amounting to 90 paise per transaction. Normally debit card interchange is anywhere between 0.65 to 1%. Credit card interchanges could be 1%-2%. So with RuPay, there is lower costs to merchants, which is passed onto the card holder," says NPCI's Hota.



RuPay also has RuPay Platinum and RuPay international, in partnership with Diners' Club and Discover Financial Services, that aims at catering to a wider audience. NPCI plans to launch RuPay credit cards by June.

RuPay cards gaining currency among the poor


More than half the 20.19 crore people who have opened basic bank accounts under the Prime Minister Jan Dhan Yojana have activated their RuPay cards and are using them regularly.
About 90 million RuPay cards – envisaged as a home-grown debit card for the economically weaker sections – are being used in the interoperable system of ATM network facilitated by the National Financial Switch alone, “which is a significant indicator for transactions in these accounts,” AP Hota, Managing Director and Chief Executive Officer, National Payments Corporation of India (NPCI), told BusinessLine.
So far, 170 million cards have been issued to all eligible accountholders. If one also includes use of RuPay cards in their own bank ATMs, the number of active cards in use will cross 100 million. “The combined number of cards in use could be much higher,” Hota said.
The number of RuPay transactions, too, has been increasing steadily. For example, from 20 lakh transactions a day about two-and-a-half months ago, the number has gone up to about 27 lakh, according to NPCI data. The average transaction value is about ₹2,000.
In the last three months, about three crore new accounts were added across the country.
Government data show that the as on January 13, the total balance in these accounts has crossed ₹30,000 crore.
According to a senior executive of State Bank of India, while banks have almost stopped campaigns for new enrolments, people continue to open accounts voluntarily.
Key impetus

New account enrolments are being spurred by, among other reasons, the increasing awareness about the social security cover that accountholders get.
Under the scheme, the RuPay card comes with an inbuilt accident insurance cover of ₹1 lakh for up to 90 days after the cardholder carries out a successful financial or non-financial transaction at a merchant establishment, an ATM or an e-commerce platform.

RuPay Card is a excellent product, no visibility: Industry


India's domestic card service RuPay is an excellent card with better rates than foreign card payment processors for banks, merchants and end-users, but its lack of visibility make for less traction, say industry experts.



Launched in March 2012, RuPay currently has more than 230 million customers and handles 20% of transactions in the country. The card has a lower debit card interchange rate, compared to international service providers, who roughly charge between 0.65%-1% on every transaction. "That's an estimated 400 crore in transaction fees that's going out of the country - which we could retain if we used a domestic card provider," says A P Hota, managing director and CEO of National Payments Corporation of India (NPCI).



The NPCI has also launched RuPay Platinum and RuPay International, in partnership with Diners' Club and Discover Financial Services, and plans to launch RuPay credit cards by this June. "But do people know about these products. Where is the awareness? Where is the advertising? There needs to be visibility," says S Santhanagopalan, president-finance, TVS Iyengar & Sons Pvt Ltd.



Since processing of transactions happens domestically, usage of RuPay over Visa or Mastercard result in a lower cost of clearing and settlement for each transaction. But this transaction affordability should be driving higher growth and more visibility, says



Currently RuPay is accepted in more than 1.88 lakh ATMs in the National Financial Switch (NFS) network. In tune with the idea of a stronger domestic payment network, the NFS itself is run by the NPCI.





"Having a domestic card makes a lot of sense at every level. I've seen the domestic NETS card used in Singalore and its amazing the kind of reach, convenience and ease of transaction. That way, we are light years behind with RuPay," says Sudhakar G, a chartered accountant with BMR & Associates LLP.

Many people are unaware that RuPay is currently issued in 277 banks in India, including all the public-sector banks like State Bank of India, Indian Overseas Bank and all major private banks like ICICI and HDFC.



"I had to ask my private bank to issue me RuPay, because on their own they don't take the initiative to issue the domestic card. I think they already have a good relationship with the international service providers and don't want to jeopardise that," says N Arunkumar, who is employed at a private bank.



"It is an uphill task. We have now talked with some banks and they have agreed to issue RuPay cards on certain days of the month," says NPCI's Hota.

NPCI has also networked with 5 lakh merchants in India and RuPay can be accessed at more than 8.75 lakh POS (point-of-sale) terminals across the country. POSs being the machines one sees at every sale counter at supermarkets, boutiques, restaurants or bars.



"I've seen travel cards in Singapore and its so efficient. The ease of travel is remarkable. I'd certainly see it as a welcome move if any such thing is available in India," says Sudhakar on the NPCI's move to launch a tap-and-go mass transit card in March in Bangalore.

Sunday, November 29, 2015

Govt extends RuPay card usage condition to 90 days regarding insurance claim

Under Pradhan Mantri Jan Dhan Yojana (PMJDY), RuPay Debit Card, with an in-built accident insurance cover of Rs 1 lakh, is provided to account holders. About 16.54 crore RuPay cards have been issued so far under PMJDY.

Rupay

Government has extended RuPay card usage condition to 90 days for a claim under an in-built accident insurance cover in case of RuPay Classic cardholders with effect from November 25, 2015. Under Pradhan Mantri Jan Dhan Yojana (PMJDY), RuPay Debit Card, with an in-built accident insurance cover of Rs 1 lakh, is provided to account holders. About 16.54 crore RuPay cards have been issued so far under PMJDY.
One of the stipulation of meeting the claim under accidental death and/or permanent disablement was that the cardholder has to carry out at least one successful financial or non-financial transactions at a merchant establishment or at ATM or micro ATM or e-commerce transaction, up to 45 days prior to the date of incident, resulting into accidental death /permanent disability.
“This condition was posing problem to RuPay cardholders. Requests were received to increase this condition of 45 days,” Finance Ministry said in a statement.
The issue was taken up by government with National Payment Corporation of India (NPCI), which operates the scheme of RuPay debit cards.
“NPCI has extended 45 days usage condition to 90 days for RuPay Classic cardholders with effect from November, 2015. Accordingly, accident arising on or after 00:00:01 November 25, 2015 will be considered for extended period,” it said.
However, claim intimations on RuPay Classic cards where accident has occurred before November 24, 2015 will not be eligible for claim benefit under 90 days usage condition.
As on November 20, out of 697 claims lodged for accidental insurance under RuPay debit card in PMJDY accounts, 644 claims have been disposed off.