Do not get confused with e-RUPI and e-Rupee both are different.
The e-RUPI is issued by RBI and is a legal tender in itself. It need not necessarily be backed by physical currency. The e-Rupee, however, can be used for digital payments in lieu of currency/cash.
Today I will talk about e-RUPI.
e-RUPI, a new digital payment solution built on the Unified Payments Interface (the “UPI”), was recently launched by the Government of India through a press note on August 02, 2021.
As per the Government of India, e-RUPI is a revolutionary digital payment service that will ensure a leak-proof delivery of welfare services and it is projected to become the stepping stone towards having a digital currency.
e-RUPI is a cashless and contactless instrument for digital payment that will play a significant role in making direct benefit transfer(DBT) more effective. This will provide a new dimension to digital governance.
e-RUPI is a one-time use, prepaid e-voucher generated through partner banks participating in the UPI ecosystem, which can be sent by sponsors (government or private organisations) directly to the mobile phones of the intended beneficiaries in the form of an SMS-string or a QR code. The voucher is in the form of a pre-paid voucher which can be redeemed at the center that accept it.
For example, if the Government wants to cover a particular treatment of an employee in a specified hospital, it can issue an e-RUPI voucher for the determined amount through a partner bank. The employee will receive an SMS or a QR Code on his feature phone / smart phone. He/she can go to the specified hospital, avail of the services and pay through the e-RUPI voucher received on his phone.
This digital payment platform has been developed by the National Payment Corporation of India on its UPI platform in collaboration with The Department of Financial Services, the Ministry of Health and Family Welfare, and the National Health Authority. This initiative will connect the sponsor of services with the beneficiaries and service providers.
- This contactless e-RUPI is easy, safe and secure as it keeps the details of the beneficiaries completely confidential.
- The entire transaction process through this voucher is relatively faster and at the same time reliable, as the required amount is already stored in the voucher.
- e-RUPI should not be confused with Digital Currency which the Reserve Bank of India is contemplating. Instead, e-RUPI is a person specific, even purpose specific digital voucher.
- e-RUPI works on simple gift-card based technology. You can present the code to a center, and they can immediately provide you with the amount.
- You will also not require any debit/credit card, mobile app, or internet banking to use the service.
- e-RUPI is a prepaid payment platform that does not require any service provider to make payments.
Consumers are not obliged to divulge their personal information and only need to complete a two-step redemption process. They do not need to have any type of digital payment app or bank account, ensuring protection of their privacy. The payment method is completely contactless.
