e-RUPI is a new digital payments medium launched on 2nd August 2021 in India, prime minister Narendra Modi. It is a cashless and contactless digital payment service, which can be used by individuals in form of SMS-string or a QR code, just like UPI.
This service is launched under the UPI umbrella and is created to enable the Government of India to reach out to the people of the country to deliver direct monetary benefits in the form of prepaid e-vouchers powered by UPI.
The e-RUPI system can be considered as a SODEXO coupon that most of the IT and other Corporate employees get, to save direct income tax, and these coupons can be used for shopping on major Households and Clothing outlets.
The e-RUPI system has been built on top of the UPI set up so that it gets linked to mobile numbers and can also be accessed using SMS-string codes, which will increase its reach, hence the beneficiary(person receiving the voucher) doesn't require access to any online banking app or any payments app.
Why e-RUPI is needed?
The Government of India distributes a lot of money to the citizens as part of various schemes run by the Government of India to help the poor live a comfortable life, like money for Healthcare, survival, food, etc. And this money is transferred through various different channels which include direct money transfer to bank accounts, or delivery of services for free by the Government.
Because of the large population of India, it becomes difficult to manage this, hence the e-RUPI system is created. So that money can be provided to the poor in form of the prepaid e-vouchers, which they can use to avail themselves various services.
For example, if an e-voucher is provided which can be used for health expenses like medicines or vaccination, then the e-voucher could only be used for that purpose and nothing else.
This way, the Government can keep a better track of things and where the money is being utilized and where it is not.
Only Government can use e-RUPI?
No, even Corporates can use it to provide prepaid vouchers to their employees, just like they have been doing till now with SODEXO, and other coupon-based systems.
The employees can redeem this one-time payment voucher without using any card, or payment app, at the merchant that accepts e-RUPI. And because this is created by the government, it will soon be adopted by large chains like Big Bazaar, D Mart, Reliance Mart, etc.
Even Hospital chains have started working on accepting this because the Government of India wants to use this to deliver Healthcare benefits to poor citizens.
How e-RUPI works?
It starts with Coupon generation, which will be in form of QR code or SMS-string, which can be shared with the beneficiary. The beneficiary can go to merchants who accept this system, which can be Household supply marts, or Hospitals or Government approved centers, where they can use this coupon to get services or to purchase anything.
The system is completely cashless and doesn't require the person using it to have any Mobile application or access to Internet banking, or even a Smartphone.
According to a statement from the PMO, now beneficiaries can receive a QR code or an SMS-based electronic voucher on their mobile phones and they do not require a card, digital payment app or even internet banking access to redeem the e-voucher when availing of a service.
Is e-RUPI like UPI or PayTM or Google Pay?
No, e-RUPI is not a digital payment service like PayTM or GooglePay, but it's a prepaid e-voucher system that can be issued by the Government or Corporates to beneficiaries be it citizens or employees, who can then avail it against various services.
It is based on UPI, to track the payments, to generate QR codes for the coupons, and the basic infrastructure is of UPI, but this is entirely different from how UPI works.
Which banks support e-RUPI?
About 11 banks support e-RUPI, the list is shown in the picture below.
Who created e-RUPI service?
The National Payments Corporation of India (NPCI) along with the Department of Financial Services(DFS), Ministry of Health and Family Welfare(MoHFW), National Health Authority(NHA) along with 11 partner banks have together worked on making this a reality. The sstem is based on UPI system which is already a well tested system for digital payments.
With the launch of this new service e-RUPI, the Government of India is taking another step towards digitalization of its services, and this one can be a big leap because the Government of India spends a lot of money in welfare schemes.
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