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Economy
Mahesh

09/12/22 23:06 PM IST

Razorpay becomes 1st payment gateway to support credit cards on UPI

In News
  • With the aim to further strengthen digital payments and boost India’s credit penetration, the platform announced its readiness to support Credit Card Transactions on Unified Payments Interface (UPI).
UPI with Credit card
  • UPI payments through credit cards can only be made to merchants using Razorpay payments gateway, which recently announced that its platform will enable credit card transactions on UPI.
  • Razorpay said it is the first payment gateway to adopt the NCPI feature that allows users to link their RuPay credit cards with UPI.
  • Customers of HDFC Bank, Punjab National Bank, Union Bank and Indian Bank will be the first to enjoy the benefits of this innovation.
Significance
  • Linking credit cards with UPI will ensure that customers will no longer have to carry their credit cards with them at all times for payments.
  • This enhances security for customers by eliminating the risk of theft or loss of credit card, and removing the possibility of skimming or copyin sensitive customer information at swiping machines.
  • The financial regulator’s move is set to offer customers the best of both worlds – the seamless payment experience of UPI with the benefits of short-term credit and the rewards of cards.
  • his will enable users to transact seamlessly with merchants across India on credit rails in line with the government’s vision to expand the structured credit infrastructure in India.
  • Active involvement from a leading ecosystem partner like Razorpay will accelerate go-to-market as it will enable credit cardholders to make transactions through UPI, thereby eliminating the need to carry a physical card.
UPI Transactions
  • Approximately 250 million Indians use UPI for their day-to-day transactions, and nearly 50 million users have one or more credit cards.
  • As per RBI data, the credit card industry has grown by 30% over the last three years, but credit card penetration remains low with just 6% of Indians having access to the medium.
  • On the other hand, UPI has recorded over 731 crore transactions in Oct 2022 alone being used by more than 40% of Indians
Source- Times Now

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