Showing posts with label rupay card. Show all posts
Showing posts with label rupay card. Show all posts

Monday, May 29, 2017

NPCI to roll out RuPay credit cards soon, says chief A P Hota

National Payments Corporation of India (NPCI), the nodal agency for digital payment systems in the country, will soon launch its RuPay credit cards for which it has roped in a few banks, a top official said. “Our credit cards will be launched soon. These would be RuPay credit cards. A pilot is going on with five banks. In the pilot, about 7,200 transactions have taken place,” NPCI MD & CEO A P Hota said. Punjab National Bank, Central Bank of India, IDBI Bank, Andhra Bank and Union Bank are working under the pilot project.
“Three more banks will come under credit card product. We will launch the RuPay credit cards soon,” Hota said in an interview to PTI. Besides, the agency will also roll-out an inter-operable tap-and-go card for transit fare payments in buses and metro trains.
“We will start these inter-operable tap-and-go cards for transit payment for metro and bus ride. We are starting this tap-and-go card with Bangalore first. From June, the service will be expanded to Kochi and Ahmadabad,” Hota said.
Speaking about digital payment expansion in the country, he said NPCI has now about 2.30 lakh bank ATMs and 3 crore point of sales (POS) terminals under its fold that will help it reach to a maximum people through non-cash mode.
He said installation of micro ATMs by banks through their business correspondents and Aadhaar pay platform will help acceptance of digital payments in rural areas.
“Last year, for all the banks together on the NPCI platform, 9 billion transactions had happened. As per our rough estimate, it was close to one billion till April this year…I believe by 2017-18, it would not be a challenge to meet the 25 billion target as was set in budget,” he added. Hota also said that about 10-12 more banks will join the NPCI infrastructure soon. Currently, there are 44 banks who are already under it.

Saturday, March 18, 2017

How RuPay Card Become the Best Credit/Debit Card of India

RuPay is India’s home grown card scheme, brought to reality by the National Payment Corporation of India.  Founded on March 26, 2012 it competes with the likes of Visa and MasterCard. Currently RuPay has a market share of around 35%, making it the second largest card scheme in terms of numbers (Visa has over 50% of the cards in the market). In this post I will be discussing about RuPay cards.

RuPay
The name has come from two words Rupee and Payment. The three colors orange, green and blue with a white background speaks for itself (Colors of the Indian National Flag).
Coined from two words Rupee and Payment
RuPay Logo
Orange and green in the logo shows that the nation is moving towards growth supported by a fast paced service to the growing nation. Blue indicates trust, peace and security which the people get as a feeling when they own this card.

NPCI
National Payments Corporation of India was formed in December 2008 and promoted by
  • State Bank of India (SBI)
  • Punjab National Bank (PNB)
  • Canara Bank
  • Bank of Baroda (BoB)
  • Bank of India (BoI)
  • Union Bank of India (UBI)
  • Investment Credit and Industrial Corporation of India (ICICI Bank)
  • Housing Development Bank of India (HDFC Bank)
  • Citi Bank
  • Hongkong Shanghai Banking Corporation (HSBC Bank)
It provides services like NFS (National Financial Switch), the Immediate Payment Service (IMPS), National Automated Clearing House (NACH), Aadhaar Payment Bridge System (APBS), RuPay, etc.…
National Payment Corporation of India
The Vision, Mission and Values of NPCI

What motivated NPCI to start RuPay Cards?
As RuPay cards is completing three years in the Indian Market, it is necessary to know what made National Payments Corporation of India to start RuPay cards.
  • Near Duopoly by Visa and MasterCard: – The two giants have dominated the electronic payment market in India. Over 95% of the transactions in India were done over these gateways.

Visa and MasterCard issued in India
Visa and MasterCards issued in India

  • Non-Issuance of ATM cards by small and co-operative banks: – As Visa and MasterCard charge exorbitant fees from the banks as joining fees, most banks did not find it viable to invest a huge sum to provide ATM services.
  • Charge from the customers: – Some retail outlets, charge around 2% per transaction from their customers as outlet owners find it difficult to make their business viable by paying huge transaction fees.
  • Motivated by China’s Union Pay and Japan’s JCB: – These are two payment gateways run by their respective governments, have helped them achieve their goals with their sincere efforts. China’s Union Pay is the world’s second largest payment scheme in terms of transaction value.
  • To serve the RBI’s vision to provide a domestic, open loop and multilateral system in electronic payments to all banks and financial institutions in India.

Benefits of RuPay Cards
  • Low transaction costs: Transaction through RuPay is 90 paisa per transaction irrespective of the value of the transaction. This fee is charged collectively from the merchant’s bank account and card issuer’s bank. Visa and MasterCard charge around 2% per transaction.
  • No Joining fees: Unlike Visa and MasterCard, RuPay doesn’t charge a single penny for joining the RuPay Payment Scheme.
  • Quicker transactions: As the transactions are done locally, the settlement process is faster than its rivals.
  • Data: Customer information is not let out to other countries as the data is secured in India locally.
  • EMV: This stands for Euro Pay, MasterCard and Visa which have set up standards to provide high class secured chip based cards. RuPay has partnered with Discover Financial Services (DFS) to provide EMV based RuPay cards. These cards demand a pin for completing the transaction at every Point-Of-Sale (POS).

Partners
  • A partnership was struck between Discover Financial Services (DFS) and National Payments Corporation of India (NPCI) such that Discover and Diners Club cards are accepted in all NFS ATMs in India and RuPay Global cards would be accepted for international purchases and cash transaction at Discover, Diners Club and PULSE network across all POS terminals worldwide. (They have over 25 million merchants worldwide in almost all nations in the world).
  • NPCI has partnered with Acculynk to provide secure encryption and authenticated consumer PIN for all its customers for e-Commerce purchases under the brand RuPay PaySecure.
  • Indian Railway Catering and Tourism Corporation (IRCTC) has partnered with Union Bank of India (UBI) and NPCI to book tickets and other services using RuPay prepaid cards which have a top-up limit of Rs. 50,000.

RuPay Prepaid Cards
IRCTC has partnered with UBI to launch RuPay Prepaid Cards

  • Japan Credit Bureau International (JCBI) and NPCI have entered into an alliance in which JCB cards would be accepted at all POS terminals and NFS ATMs in India in return for which the NPCI member banks can issue RuPay/JCB cards which would be accepted at all POS terminals in the JCB network worldwide.
  • China’s Union Pay and NPCI have struck a deal such that CUP cards will be used at all RuPay POS terminals in India.
  • Partnership of NPCI with Oxigen group to launch OxiCash Money Transfer which makes Oxigen Wallet India’s First Non-banked Mobile Wallet to provide Instant Money Transfer Service without hassles.

Pradhan Mantri Jan-Dhan Yojana and RuPay
Shri Narendra Damordas Modi, on his first Independence Day speech declared scheme for bringing about financial inclusion in India by bringing the un-banked population in the banking ecosystem. Features what an account holder would receive
  • Zero balance Account.
  • Free RuPay Debit Card.
  • Rs 1, 00,000 life cover and Rs 30,000 accidental cover by Life Insurance Corporation of India (LIC).
  • Overdraft facility of Rs 5000 for each account.
RuPay Payment Scheme benefitted the most from this scheme. The adoption of RuPay cards increased drastically in India making it the second largest Payment Card in India with around 35% market share. Over 25% of the transaction in India is done using RuPay cards across ATMs, POS terminals and e-Commerce Platforms.

IMG_0505
Outdoor Advertisement of RuPay Platinum Cards for foreign business travelers on Airport Road, Bangalore

Achievements
Ø The duo-poly in India is now a story of the old. Now there are three significant players in the payment card market, namely Visa, MasterCard and RuPay in India.
Ø It has 18 prepaid instruments on board who issue RuPay prepaid cards.
Ø RuPay cards are issued by 27 Public Sector Banks, 13 Private Banks and over 250 Co-operative & Gramin Banks. RuPay was a boon to the co-operative banks and its customers due to minimal cost in issuing RuPay cards.
Ø It has won many laurels for itself like “Renaissance Skoch Award” for building country’s own and the fastest adopted card system in the world.
Ø It has broken all records by building a payment gateway in less time, whereas it usually takes around five years to make a fully functional payment system.
Ø It has partnered with Kochi Metro to provide RuPay card services at all its station in the metro network.
Ø RuPay debit cards were issued by the Punjab Government to all commission agents for quicker payments through the ‘Kisan Arthia Information and Remittance Online Network’.
Ø RuPay prepaid cards were issued to AMUL farmers under the brand ‘Kotak Samriddhi’ for direct transfer for their daily produce.

Sunday, February 26, 2017

Mastercard, Visa And Rupay Come Together To Launch BharatQR For Digital Payments


Come Monday, Indians will have yet another way to pay.
This time, it’s a QR (quick response) code-based payment solution that will allow merchants to accept digital payments from those who hold a debit card even if they don’t have a card swiping terminal. The product, called BharatQR, has been jointly developed by Mastercard Inc., Visa Inc. and Rupay. It will be formally launched on Monday in Mumbai.
It becomes the second major digital payment option being promoted by the government after the Unified Payments Interface (UPI) based BHIM app. Both are being pitched as an alternative to cash following the November 8 demonetisation decision. While currency availability has now started to normalise, the government is trying to encourage digital payments by making them more convenient and cost effective.

How QR Code-Based Payments Work

A QR code-based payment system works on the existing network of card companies like Mastercard, Visa and Rupay. This means that anyone holding a debit card from any of these providers can pay using a QR code, provided they have downloaded an app from their bank which supports this payment option.
If a customer has the app and wants to make a payment at a merchant who doesn’t have a card swiping machines, he can simply scan the merchant’s QR code and transfer the money directly from the bank account.
Private payment firms like Paytm already offer this facility, but both parties need to have a Paytm account to use it.
BharatQR attempts to overcome this limitation by allowing people to pay without having to choose one payment network over another. This will, however, need a large number of bank apps to support such payments.
QR-based payments have an added advantage of being infrastructure-light. This means that a merchant doesn’t require a lot of equipment to accept digital payments, which reduces costs.
Such a payment system has the potential for take off as it falls under the digital point-of-sale solution segment, for which the Reserve Bank of India (RBI) recently proposed lower merchant discount rates in its draft circular.
Moreover, penetration of card payment infrastructure in India is abysmally low. As of October 2015, there were only 12 lakh point of sale terminals in the country and there are only 6.7 card transactions per capita, much lower than Russia’s 47 and Brazil’s 55, according to a March 11 report by the National Payments Corporation of India and JM Financial Ltd.

A Crowded Payment Ecosystem

The launch of BharatQR will add to an already crowded market for digital payments. There are at least a dozen non-cash payment mediums out there including UPI, mobile wallets, net banking, debit cards and soon-t- be-launched Aadhaar Pay, among others. Individual firms like Paytm also have their own QR- and non-QR-based payment products.
Not all such products have worked.
For instance, Mastercard had launched a QR-code pased payment system in November 2016 called Masterpass. This product, however, remained limited in its reach as it was launched with a tie-up with only RBL Bank. Mastercard will now work with the government to develop BharatQR, which is a wider cross-platform product, Murali Nair, senior vice-president for market development-South Asia at Mastercard, told BloombergQuint in a response to an email on January 23.
Visa declined to comment on the story.

Saturday, February 18, 2017

RBI mulls giving banks freedom to fix bank service charges for transactions



In an attempt to promote cashless transactions in the country, Reserve Bank of India (RBI) has given banks the freedom to fix bank service charges for transactions, stated Santosh Kumar Gangwar, Minister of State in the Ministry of Finance, in Lok Sabha on Friday. 

RBI has deregulated interest rates on credit card dues. Interest rates are determined by banks with the approval of their respective Board of Directors subject to regulatory guidelines on the interest rate on advances issued by RBI from time to time. RBI does not maintain information on the rate of commission charged. 

National Bank for Agriculture and Rural Development (NABARD) has approved a scheme for giving 0.5 percent incentive on payments made through the Aadhaar Enabled Payment System (AEPS) to merchants. 

With regards to debit card transactions on PoS devices, between January 1 and March 31, 2017, Merchant Discount Rate (MDR) has been capped at 0.25 percent for transaction up to Rs. 1,000, and for debit card transactions value between Rs. 1,000 and Rs. 2,000, MDR has been capped at 0.5 percent. 

RBI has decided that till March 3, 2017, banks and prepaid payment instrument issuers shall not levy any charges on customers for transactions up to Rs. 1,000 settled on Immediate Payment Service (IMPS), Unstructured Supplementary Service Data (USSD) and Unified Payments Interface (UPI). 

Further, Government has issued a direction in public interest to all public sector banks not to charge fees for transactions settled on IMPS and UPI in excess of rates charged for National Electronic Funds Transfer (NEFT) for transactions above Rs. 1,000, with service tax being charged at actual; for USSD transactions till March 3, 2017, above Rs. 1,000, a further 50paise discount is provided. 

NPCI has waived switching fees for RuPay Card transactions (both for PoS and e-commerce), IMPS, UPI, National Unified USSD Platform (NUUP) and AEPS, with effect from January 1 to March 31, 2017. 

Credit card, debit card, charge card and other payment card services by banks have been exempted from payment of service tax for transactions of up to Rs. 2,000. The government has introduced Lucky Grahak Yojana for customers and Digi Dhan Yojana for merchants to promote means of cashless transactions. 

In terms of Office of Controller General of Accounts Office Memorandum dated December 14, 2016, the applicable Merchant Discount Rate (MDR) charges on debit cards for payment up to Rs. 1, 00,000 shall be absorbed by the Government. 

In terms of Department of Public Enterprises letter dated December 9, 2016, all Central Public Sector Enterprises (CPSEs) are required to ensure that transaction fees, MDR charges associated with payment through digital means shall not be passed on to the consumers and all such expenses shall be borne by CPSEs. 

RBI has also cautioned the users, holders and traders of Virtual Currencies (VCs), including Bitcoins about the potential financial, operational, legal customer protection and security related risks that they are exposing themselves to. The creation, trading or usage of VCs including Bitcoins, as a medium for payment have not been authorised by the Reserve Bank of India. 


Sunday, January 22, 2017

Issue of RuPay cards jumps post-demonetisation


Banks in the country have issued nearly 60 per cent more RuPay cards for Pradhan Mantri Jan Dhan Yojna (PMJDY) account-holders in the two months following demonetisation of ₹500 and ₹1,000 currency notes on November 8 than they had issued a year prior to that.
Banks had added around 2.83 crore new RuPay cards from November 25, 2015, to November 9, 2016. Compared to this, in just two months following demonetisation, nearly 1.56 crore RuPay cards were issued.
The number of RuPay cards increased to 19.43 crore by November 9, 2016 from 16.6 crore as on November 25, 2015.
Of the 26.68 crore PMJDY account-holders, nearly 21 crore (78.71 per cent) had RuPay cards by January 11.
RuPay card is an initiative by the National Payments Corporation of India (NPCI) to allow all Indian banks and financial institutions to participate in electronic payments.
Aadhaar seeding
In spite of the Prime Minister’s endorsement of JAM (Jan Dhan, Aadhaar and mobile) vision on several forums, the seeding of Aadhaar numbers with PMJDY accounts remained at 42 per cent of the total PMJDY accounts in November 2015. Of the 19.34 crore accounts, only around 8.19 crore were seeded with Aadhaar numbers as on November 25 2015.
The Prime Minister had stated that the JAM vision would serve as the bedrock of many initiatives to come.
Aadhaar seeding with bank accounts crossed the 50 per cent mark only in August 2016.
In the one year to November 2016, banks seeded 5.49 crore more accounts with Aadhaar numbers.
Of the 25.51 crore PMJDY accounts, around 13.68 crore were seeded with Aadhaar by November 9, 2016. During the post-demonetisation period between November 9, 2016, and January 11, 2017, banks seeded 1.67 crore more accounts with Aadhaar numbers.
Of the 26.68 crore PMJDY account-holders, nearly 15.36 crore (57.58 per cent) were seeded with Aadhaar numbers by January 11.

Centre pushes for fingerprint money transactions through Aadhaar Pay



Keen to push digital payments among the poor and illiterate in rural areas of the country, the government is pushing to popularise Aadhaar Pay which ensures financial transactions by just using fingerprint.



Aadhaar Pay, which is merchant version of the already in use Aadhaar-enabled payment system (AEPS), will become an alternative for all online and card transactions which require password and PIN.



The app facilitates merchants to take cashless payments from a customer who is only required to give his Aadhaar number, name of the bank (from where the money is to be deducted) and finger print for authentication. Unique Identification Authority of India (UIDAI) CEO AB Pandey said Aadhaar Pay works on any android-based phone, even a low cost one, with an attached finger biometric device.



"This ensures digital transactions which are cardless, PINless... There is no need of smartphone for the customers," he added. In order to popularise the use of Aadhaar Pay among merchants, the government has asked banks to enrol 30-40 merchants per branch so that they are able to take cashless payments from customers.



At present five banks — Andhra Bank, IDFC Bank, IndusInd Bank, State Bank of India and Syndicate Bank — have gone live over Aadhaar Pay and several banks are in the process of launching pilots on the app.



A senior official said the plan is to identify Aadhaar Pay transactions separately and to incentivise merchants for long-term sustainability and scalability of the system. As it needs a biometric device costing about Rs 2,000, the government is also working on an incentive model so that cost of the device is amortised over time and the merchants are encouraged to use it.

Rejecting security concerns over AEPS, the UIDAI CEO said transactions using Aadhaar Pay are much more secure than any other digital mode of transaction, both in terms of technology and process. Besides the merchant using the app being enrolled in the bank and the customer's bank account linked to Aadhaar, he said the biometric data get encrypted leaving little scope for any misuse. 

"Fingerprints can't be copied as it get encrypted. Even if any merchant or customer tries to misuse the fingerprints, he will be caught immediately as the location of merchants using the app is known to the bank," he explained.



The AEPS platform, launched in December 2012, enabled people to carry out banking transactions over hand-held devices (micro ATM) using the Aadhaar number and fingerprints. The Andhra Pradesh government has launched cashless payments at most of the fair price shops (FPS) and Gujarat, in partnership with CSC e-governance, has launched cashless payments using AEPS platform at over 3,000 fair price shops.

Friday, December 30, 2016

PM Narendra Modi's Mastery Of The Message To Be Tested As India Enters 2017

PM Narendra Modi's Mastery Of The Message To Be Tested As India Enters 2017: Foreign Media

Prime Minister Narendra Modi will go into 2017 watchful but unbowed.

In what will be a busy year of state elections, economists are slashing India's growth forecasts because Prime Minister Narendra Modi's unprecedented cash clampdown is denting demand. The experiment has missed its first marker of success and the almost-daily regulatory flip flops are enraging citizens.

Yet, analysts point to the fact that India hasn't seen bloody riots of the kind witnessed in Venezuela, which followed PM Modi in banning higher-value banknotes before it reversed the move. Perhaps most importantly, a fractured opposition hasn't been able to capitalize on the social pain triggered by the world's most sweeping currency policy change in decades.

"So far there has been no successful mobilization of public opinion against demonetization," said Sanjaya Baru, New Delhi-based director at the International Institute of Strategic Studies and media adviser to Narendra Modi's predecessor, who's written books analyzing former administrations. "Though we can't say what's going to happen in the future, at least so far it would seem like Modi is on top."

The move tests PM Modi's reputation as the master of the message. He has touted the cash ban as India's strongest step against tax evasion and graft in a nation where rising economic inequality helped him sweep to power with the biggest electoral mandate in 30 years.

PM Narendra Modi on Nov. 8 banned 500 and 1,000 rupee notes, removing 86 percent of currency in circulation. With TVs beaming pictures of serpentine queues spilling out of banks and newspapers carrying stories of rural distress, he pleaded with Indians to give him until Dec. 30 to ease the strife.

Here's the impact: India's economy is projected to grow 6.5 percent October-December instead of the 7.8 percent economists had predicted earlier. Moody's Investors Service says asset quality at Indian banks -- reeling under a pile of bad loans -- will weaken. Small businesses, the biggest creators of jobs, are estimated to forfeit transactions worth $9 billion.

International observers such as former U.S. Treasury Secretary Lawrence Summers and former World Bank Chief Economist Kaushik Basu have criticized Modi's move.

"Even if consumption revives quickly on the back of remonetization, investment could remain muted for longer," said Pranjul Bhandari, Mumbai-based economist at HSBC Holdings Plc. "The output gap, that is the slack in the economy, will likely remain negative for two quarters longer than we had initially estimated, making it unattractive for investors."

Medium as Message

And while the potential impact on state polls due in 2017 is not yet clear, the subdued outlook hasn't dented the performance of Narendra Modi's party in municipal elections over the past month.

One reason could be his ability to channel his message via social media, as President-elect Donald Trump does, allowing Narendra Modi to speak directly to the public without any media filter.

"This shows the importance people attach to good governance," PM Modi tweeted on Dec. 20 of the election results.

He, however, hasn't held a single national press conference since taking office and interviews are vetted. Instead, Narendra Modi relies on public speeches and has used the medium more than 10 times since Nov. 8 to defend demonetization.

Narendra Modi's speeches brim with rhetorical flourish and his bold cash clampdown became important part of his narrative as he approached the half way mark in his term early November.

"Modi presented himself as someone with fire in the belly, willing to change things in the country," said Ullekh NP, author of War Room: The People, Tactics and Technology Behind Narendra Modi's 2014 Win. "People at least for now believe his message; that he's incorruptible, that he has no family, that he's focused on the nation. But unlike an election campaign, where promises suffice, here there's prolonged hardship for people."

Support for Narendra Modi will waver if opposition parties form alliances in Uttar Pradesh, Ullekh said by phone from the key electoral state.

Shifting Goalposts

Narendra Modi's skill in rebranding has allowed him to recast his message even as massive deposits of old notes being turned in at banks robbed him of his main reason for the demonetization.

Indians have deposited 13 trillion rupees of the 15.4 trillion rupees invalidated by Narendra Modi's move, undermining the government's estimate that about 5 trillion rupees of this was unaccounted money and wouldn't reach banks.

"It seems very likely that the original aim of the demonetization drive -- forcing illicit wealth holders to come to light -- has already very nearly failed," said Vaninder Singh, an analyst at NatWest Markets, adding that this has pushed the government to change its commentary to fostering a cashless economy. "At what level of economic pain will we see an inflection in Modi's ratings? The answer depends upon how 'patriotic sacrifice' interacts with economic pain."

Political rivals allege that the shifting goalposts indicate Narendra Modi's Nov. 8 decision was never intended to target black money. Leaders from the main opposition Indian National Congress party said they'll have to hold smaller rallies in Uttar Pradesh due to the cash clampdown. The state's Chief Minister Akhilesh Yadav, from the Samajwadi Party, said he's sure to win because the lines of harassed citizens queuing up at cash machines will now shift to vote for him at polling booths.

Faith and Fear

Uttar Pradesh is due to vote by mid-May. It is India's most populous state and the biggest contributor to farm output. Elections will be held before that in four other states, including Punjab, called the 'bread basket of India.'

"Farmers are hurting," said Ajay Vir Jakhar, chairman of lobby group Farmers' Forum and grandson, son, and brother of Congress politicians. "Demonetization will have limited impact politically because opposition isn't able to take advantage of the pain."

Investors will focus on the government's first growth forecast for the year through March -- due Jan. 7 -- to assess the economic impact. Meanwhile, tax officials are raiding homes and offices across the country in a China-style crackdown on corruption, seizing bundles of currency notes and stashes of gold and jewelry.

Narendra Modi should follow his cash ban by lowering corporate and income tax rates in the budget -- likely Feb. 1 -- to encourage compliance, said analysts at Kotak Institutional Equities Ltd., adding that critics of his Nov. 8 decision are underestimating the "psychological" impact of the step.

The move "will reinforce the faith of the general population in the government's efforts to clean up the system and instill fear in a section of the society, which hitherto has had little regard for the laws of the land," they wrote in a Dec. 19 report. "Faith and fear."