National Payment Corporation of India (NCPI), has launched India’s first payment gateway RuPay on March 26, 2012. RuPay is the name of the domestic card scheme launched in competition with global payment processing firms Visa, MasterCard and other multinational brands.
RBI did an analysis of the card transactions happened in India and concluded that most of the card transaction done by Indians were in India only but due to using the services of multinational brands like Visa and MasterCard for payment solutions Indian banks & customers are ending up paying these multinationals. So, in order to fix up this issue, RBI asked the Indian Bank Association (IBA) to launch a non-profit payment solutions company keeping in mind the requirements of Indian banks. And the outcome of this effort was RuPay.
With the launch of RuPay, now Co-operative banks and smaller commercial banks will also start issuing card which were earlier not issuing due to high cost of initial participation fee and quarterly minimum processing fees to get payment solution service from global payment processing firms. Currently RuPay scheme is available for debit and pre-paid cards for domestic transactions only. Rest of the services like credit card, net banking and international acceptability will soon be available on RuPay.
As of now only two national banks are offering RuPay Debit cards to their customers which are Bank of India and Union Bank of India. Whereas the banks accepting the RuPay Debit cards on their POS terminals are Axis Bank, Bank of Baroda, Corporation Bank and State Bank of India. Soon rest of the banks will also
NPCI launched RuPay ATM/Debit cards will be accepted at all 91,000+ ATMs and over 6 lakh Point of Sale terminals in the country. Soon it would be accepted on internet and also at ATMs/ POS terminals abroad.
Benefits Of RuPay Over Global Brand Visa & Master Card
- This will make more people use cards for payments which will lead to electrification of payments.
- RuPay is a non-Profit company which will allow banks to use this service without any participation or quarterly processing fee.
- RuPay will help banks to reduce their cost of issuing debit cards.
- RuPay will help in extending payment network in rural and semi-rural areas also.
- RuPay will remove the extra 2% charge which customers have to pay on making payment using card.
- RuPay will reduce the cost of transaction processing by 40% as compare to international schemes.
- RuPay will take all fees in Indian currency as compare to global companies which take fees in foreign currency.
- The fee structure under RuPay scheme is transparent and not subject to one-on-one
negotiation with member banks.
- RuPay will help reducing the cost of banks, a part of benefit may be passed to customers by way of reduced customer charges.