What is UPI e-voucher and how will it replace bank accounts, UPI apps?
NPCI has issued new guidelines for UPI platforms regarding prepaid vouchers dismissing the need for UPI apps or bank accounts altogether
The National Payments Corporation of India (NPCI) has issued new guidelines for the Unified Payment Services (UPI) platform on July 13. As per the new rules, electronic vouchers, or an e-voucher, can be issued to mobile phone holders without any app or bank account. These vouchers can be used for one time payments. An OTP authentication has also been added to make the payment secure.
According to media reports, the e-vouchers is expected to help the central government in its aim to promote Covid vaccination under private infrastructure too. But, in the long term, UPI prepaid vouchers can play a vital role in the national payment system. It can be used as one time payment instrument. and prove to be a better option than other prepaid instruments.
Get away with plastic cards
Issuing a plastic prepaid card at present proves to be extremely costly. A bank has to spend around Rs 200 on a plastic prepaid card with a chip. This includes the printing, delivery and other logistic expenses of the card. But with the introduction of UPI prepaid vouchers, one can get rid of such expenses.
UPI prepaid vouchers can be directly transferred to the customer’s mobile phone. This can be in the form of a quick response code or an SMS string. Additionally, OTP will act the second protective layer for secure payments.
Bank accounts, UPI linked apps not required
While announcing the new UPI feature, NPCI said that banks can issue these prepaid vouchers to the wholesale buyer. They will be considered as the sponsors of these e-vouchers. These vouchers can be in the form of corporate, state government, central government or business customers of any bank. The beneficiary of this prepaid voucher can be any person using a smartphone. For this, it is not mandatory to even have a bank account or have any UPI app installed in their phones.
Like other prepaid vouchers, a maximum limit of Rs 10,000 has been fixed for UPI e-voucher. It will also have a merchant code to ensure that a prepaid voucher is used only for the designated item or service. This will, for example, ensure that an e-voucher issued for vaccination or other specific purpose isn’t misused.
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