Newsbytes
  • India
  • Business
  • World
  • Politics
  • Sports
  • Technology
  • Entertainment
  • Auto
  • Lifestyle
  • Inspirational
  • Career
  • Bengaluru
  • Delhi
  • Mumbai
  • Videos
  • Visual Stories
  • Reviews
  • Phone Reviews
  • Fitness Bands Reviews
  • Speakers Reviews
  • Find Cricket Statistics
Hindi
More
In the news
Twitter
Xiaomi
Adani Group
Life Insurance Corporation of India
Stock Market
Newsbytes
Hindi
Newsbytes
User Placeholder

Hi,

Logout


India
Business
World
Politics
Sports
Technology
Entertainment
Auto
Lifestyle
Inspirational
Career
Bengaluru
Delhi
Mumbai
Videos
Visual Stories
Reviews
Phone Reviews
Fitness Bands Reviews
Speakers Reviews
Find Cricket Statistics

More Links
  • Videos

Download Android App

Follow us on
  • Facebook
  • Twitter
  • Linkedin
  • Youtube
 
Home / News / Business News / #NewsBytesExplainer: What's the e-RUPI system and how does it work?
Business

#NewsBytesExplainer: What's the e-RUPI system and how does it work?

#NewsBytesExplainer: What's the e-RUPI system and how does it work?
Written by Chandraveer Mathur
Aug 02, 2021, 06:45 pm 3 min read
#NewsBytesExplainer: What's the e-RUPI system and how does it work?
Here’s what the e-RUPI system is and how it works

Accelerating the transition to a digital financial ecosystem in the country, Prime Minister Narendra Modi launched the e-RUPI digital payment system today. The new person-specific and purpose-specific payments system offers cashless and contactless payment options in the form of an SMS string or QR code that functions as a prepaid gift voucher. Here's how it works and how to use it.

Tamper-proof
e-RUPI was conceptualized as leak-proof delivery system for state-run schemes

The e-RUPI system is the brainchild of the National Payments Corporation of India (NPCI), the Department of Financial Services, the Ministry of Health and Family Welfare, and the National Health Authority. The system is built on the NPCI's UPI system. It is expected to ensure leak-proof delivery of government services to beneficiaries under Mother and Child welfare schemes, tuberculosis eradication programs, fertilizer subsidies, etc.

Like vouchers
Voucher-like system works without apps, internet banking, and bank cards

The government added that e-RUPI can also be used by private sector entities for employee welfare and corporate social responsibility programs. The system works by sending an SMS string or QR code directly to the beneficiaries. The code can then be used as a prepaid gift voucher to redeem benefits at specific centers without the use of credit/debit cards, mobile apps, or internet banking.

Mechanism
Bank-generated e-RUPI codes are directly delivered to intended recipients

Notably, NPCI has onboarded many partner banks that would issue the vouchers. This includes both public and private-sector institutions. To issue benefits using e-RUPI, corporate/government agencies will have to approach these banks with the details of the beneficiaries and the purpose of the payments. Cellular service providers would then be tasked with delivering the vouchers to the beneficiaries uniquely identifiable by their phone numbers.

Effectiveness
Payments will be processed only after beneficiaries receive corresponding services

The vouchers will only be redeemable by the beneficiaries in whose name they have been issued. Additionally, the payment can only be processed after the service has been provided to the beneficiary. The biggest advantage of this system is that it can service the rural population since it doesn't need the beneficiary to have a smartphone or app. A trusty phone number should suffice.

Partner banks
e-RUPI works with 11 banks, some fully support the system

For starters, NPCI has partnered with 11 banks, of which Canara Bank, IndusInd Bank, Indian Bank, Kotak Bank, and Union Bank of India can only issue e-RUPI vouchers but cannot accept them. However, major banks like State Bank of India, ICICI Bank, HDFC Bank, and Punjab National Bank fully support both issuing and redemption of e-RUPI vouchers.

Digitization
e-RUPI distributes Indian rupee, but things could change soon

At present, e-RUPI uses the Indian Rupee as the underlying asset being dispensed to beneficiaries. This is different from a central bank digital currency (CBDC) system that the government is reportedly developing. The e-RUPI system will be a cornerstone of the CBDC system since it can highlight potential loopholes and shortcomings in the digital infrastructure that is key to the CBDC's success.

Digital currency
Legal framework changes necessary before CBDCs are introduced

The RBI said that it is working toward a phased implementation strategy for the CBDCs that would be equivalent to the Rupee. However, the introduction of CBDCs is preceded by sweeping changes to the enabling legal framework since the current provisions are designed for physical printed currency. That said, India hasn't pioneered the voucher system. America and many Asian countries already use similar systems.

Share this timeline
Facebook
Whatsapp
Twitter
Linkedin
Chandraveer Mathur
Chandraveer Mathur
Mail
I am a design engineer with a knack for all things related to tech, smartphones, photography, and automobiles. When I am not tinkering with gadgets, I enjoy books, CGI, a lovingly curated audio library, and therapeutic solo drives.
Latest
Narendra Modi
Unified Payment Interface (UPI)
National Payments Corporation of India
Related
Latest
Sidhu gets 1 year in jail in 34-year-old case
Sidhu gets 1 year in jail in 34-year-old case Politics
India defends wheat exports ban at UN with COVID-19 barbs
India defends wheat exports ban at UN with COVID-19 barbs India
IPL 2022, RCB vs GT: Pitch report, stats, streaming details
IPL 2022, RCB vs GT: Pitch report, stats, streaming details Sports
Cannes Day 2: Deepika, Aishwarya, Tamannaah dazzle on red carpet
Cannes Day 2: Deepika, Aishwarya, Tamannaah dazzle on red carpet Entertainment
Hyundai VENUE (facelift) to debut in June, unofficial bookings open
Hyundai VENUE (facelift) to debut in June, unofficial bookings open Auto
Narendra Modi
Professor demands gun license from PM after Gyanvapi 'shivling' comments
Professor demands gun license from PM after Gyanvapi 'shivling' comments India
12 killed in salt factory wall collapse in Gujarat's Morbi
12 killed in salt factory wall collapse in Gujarat's Morbi India
Twitter executive summoned over 'no action' against Kunal Kamra's video
Twitter executive summoned over 'no action' against Kunal Kamra's video India
Centre eases ban on wheat export: Here are more details
Centre eases ban on wheat export: Here are more details Business
Nepal: PM Modi arrives in Lumbini on Buddha Purnima
Nepal: PM Modi arrives in Lumbini on Buddha Purnima World
More News
Unified Payment Interface (UPI)
You may pay extra for mobile recharges on PhonePe
You may pay extra for mobile recharges on PhonePe Technology
Netflix introduces UPI AutoPay feature to make subscription renewal easier
Netflix introduces UPI AutoPay feature to make subscription renewal easier Technology
Now, you can add personalized background while using WhatsApp Payments
Now, you can add personalized background while using WhatsApp Payments Technology
How to use WhatsApp Pay to send money to contacts?
How to use WhatsApp Pay to send money to contacts? Technology
Create an app for Bill Gates, win Rs. 36 lakh
Create an app for Bill Gates, win Rs. 36 lakh Technology
More News
National Payments Corporation of India
WhatsApp Pay spotted beta testing cashback feature in India
WhatsApp Pay spotted beta testing cashback feature in India Technology
PhonePe emerges as India's leading UPI app
PhonePe emerges as India's leading UPI app Business
2.2 billion UPI transactions recorded in November
2.2 billion UPI transactions recorded in November Business
WhatsApp's payments service is finally here: How to use it
WhatsApp's payments service is finally here: How to use it Business
New record: UPI records over 2 billion transactions in October
New record: UPI records over 2 billion transactions in October Business
More News
Related
#NewsBytesExplainer: What's Pegasus spyware and how does it spread?
#NewsBytesExplainer: What's Pegasus spyware and how does it spread? Technology
Next News Article
Next News Article

Love Business news?

Subscribe to stay updated.

Business Thumbnail
India News Business News World News Politics News Sports News Technology News Entertainment News Auto News Lifestyle News Inspirational News
Career News Bengaluru News Delhi News Mumbai News Mukesh Ambani Indian Premier League (IPL) Karnataka Samsung Xiaomi West Bengal
Bihar Virat Kohli Rohit Sharma Haryana Narendra Modi Arvind Kejriwal Tamil Nadu Gujarat Yogi Adityanath YouTube
Instagram Hollywood News Uttar Pradesh Kerala Netflix Bollywood News Mamata Banerjee Maruti Suzuki Rahul Gandhi Elon Musk
Shah Rukh Khan Chelsea FC OPPO Akhilesh Yadav Indian Cricket Team Apple Manchester United Salman Khan Cryptocurrency OnePlus
Amitabh Bachchan ICC Women's World Cup Vivo India vs Sri Lanka
About Us Privacy Policy Terms & Conditions Contact Us Ethical Conduct Grievance Redressal News News Archive Topics Archive IPL 2022 Schedule IPL 2022 Points Table Find Cricket Statistics
Follow us on
Facebook Twitter Linkedin Youtube
All rights reserved © NewsBytes 2022