What is erupee?
Recently the Modi Indian government launched a new payment option called the eRUPI. You must have various questions regarding eRUPI which must be confusing due to various payment options like the UPI and other online banking transactions. What is eRUPI? What is the need for which it has been launched? How is it different from other available payment options? All your questions will be answered by this 5-minute read.
This system is launched by the department of financial services, the National payments corporation of India, the Department of family welfare, and the national health authority which quotes this system as a Person Specific and Purpose Specific system. eRUPI is a cashless and contactless digital payment medium that will be delivered to the mobile phones of the beneficiaries in the form of SMS alerts or QR codes.
This will be essentially like a prepaid gift voucher that will be redeemable at certain accepting centers and will not include any credit, debit card, or any other mobile banking app. eRUPI will connect the sponsor of services with the beneficiaries and the service providers in a digital manner without any physical interface.
What is erupee?
Let’s understand this with a simple example.
Imagine you work for a company. During Diwali, your company gives you various bonuses along with free gifts like decorations, showcases which you already have. Thus there is no real use of such gifts for you and you are left with option none other than to forward those to someone else. But now with eRUPI the company can give you the same gifts in form of eRUPI gift vouchers which may be acceptable at certain centers. This will enable you to expend that amount in any way that you want. It may be clothing or a food voucher that you may put to use as you desire.
But to be very frank this system will be used majorly by the government for its purpose. Any corporate or government agency will have to approach a govt or a private sector bank with details of the person in whose name the voucher has to be issued or to whom the payments are to be made. The beneficiaries will be identified by their mobile number and the voucher that will be issued by the bank to the service provider in the name of the person registered by that mobile number. this will be directly sent to the beneficiary’s mobile for consumption.
Other than this governments can use it to issue facilities like student scholarships to reduce the scam involved by the institutions. There are 11 banks at present that have identified eRUPI as a payment system which are:
|Sr. No.||Bank Name||Issuer||Acquirer||Acquiring App / Entity|
|1||Axis Bank||✔||✔||Bharat Pe|
|2||Bank of Baroda||✔||✔||BHIM Baroda Merchant Pay|
|4||HDFC Bank||✔||✔||HDFC Business App|
|5||ICICI Bank||✔||✔||Bharat Pe & PineLabs|
|9||Punjab National Bank||✔||✔||PNB Merchant Pay|
|10||State Bank of India||✔||✔||YONO SBI Merchant|
|11||Union Bank of India||✔||NA|
To be very clear eRUPI is not a platform it is just another form of a digital service by the banks in which an entity can issue gift vouchers in the name of a beneficiary instead of monetizing his/her bank account due to which the beneficiary can leverage its use even in absence of a bank account or a digital payments app.
Another example explaining one of its advantages is that the benefits given by the government in form of DBT’s like student scholarships or which are meant for a specific purpose will only be valid for the same. The beneficiary will not be able to make ineligible use of the benefits for other unvalued purposes. Like, a scholarship voucher will only be applicable for use in an educational institution and will not hold any value elsewhere, very insightful RIGHT.
Other than this a voucher meant for medical expenses will be usable at a medical institution.
To get a list of Hospitals where this voucher will be applicable. CLICK HERE
What is erupee?
Benefits to the Consumer
- Contactless – Beneficiary should not carry a print out of the voucher
- Easy redemption – 2 step redemption process
- Safe and Secure – Beneficiary doesn’t need to share personal details while redemption hence privacy is maintained
- No digital or bank presence required – Consumer redeeming the voucher need not have a digital payment app or a bank account
Benefits for Hospitals
- Easy & Secure – Voucher is authorized via a verification code
- Hassle free & Contactless payment collection – Handling of cash or cards is not required
- Quick redemption process – The voucher can be redeemed in a few steps and lesser decline due to pre-blocked amount
Benefits for Corporates
- Corporates can enable well-being of their employees
- End to end digital transaction and doesn’t require any physical issuance hence leading to cost reduction
- Voucher redemption can be tracked by the issuer
- Quick, safe & contactless voucher distribution
What is erupee?
The government is already working on a central bank digital currency and the launch of eRUPI could potentially identify the gaps in the digital payment infrastructure before rolling out any major change and is important with respect to the success of the digital currency in the coming future. Moreover, the use of eRUPI will be kept under strict observation for now and its use and development in the future will depend upon its end-use.
END OF ARTICLE | What is erupee?
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