National Payments Corporation of India (NPCI)

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Overview:

The National Payments Corporation of India (NPCI) is looking at various opportunities for further tie-ups with global financial service entities to make RuPay cards at par with Visa or Mastercard.

About National Payments Corporation of India (NPCI):

  • It is an umbrella organisation for operating retail payments and settlement systems in India.
  • It is an initiative of the Reserve Bank of India (RBI) and the Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007, to create a robust Payment & Settlement Infrastructure in India.
  • It has been incorporated as a “Not for Profit” Company under the provisions of Section 25 of the Companies Act 1956 (now Section 8 of the Companies Act 2013).
  • The Company is focused on bringing innovations in the retail payment systems through the use of technology for achieving greater efficiency in operations and widening the reach of payment.
  • NPCI is promoted by ten major banks, including the State Bank of India, Punjab National Bank, Citibank, Bank of Baroda, and HSBC.
  • The regulatory board of the NPCI, headquartered in Mumbai, includes nominees from the RBI along with nominees from ten core promoter banks. 
  • Payment systems that the NPCI can operate include National Financial Switch (NFS), Immediate Payment System (IMPS), Aadhaar-enabled Payments System (AEPS) and National Automated Clearing House (NACH).
  • Services Offered by NPCI:
    • Bharat Bill Payment Interface (BBPI): It was developed by the NPCI to help the retail payments sector. With the introduction of the BBPI, a single platform has been made for aggregators and 0billpayers. 
    • Immediate Payment Service (IMPS): It gives you the option to transfer funds immediately. The facility is available at any given time. The beneficiary details must be added to transfer funds via IMPS. You can add the IFSC code and the account number to transfer funds via IMPS. 
    • RuPay: NPCI introduced RuPay so that average citizens can make financial decisions. RuPay is an affordable card and can be issued as credit cards, debit cards, and prepaid cards. More than 300 million RuPay cards are in India. 
    • USSD Services: Unstructured Supplementary Service Date (USSD) was introduced by the NPCI to allow individuals to make banking solutions without the need for the internet or smartphones. 
    • BHIM: BHIM uses UPI to complete payment transfers. You can make payments via BHIM by entering the Virtual Payment Address (VPA) or the registered mobile number. No smartphone is required to transfer funds via BHIM. 
    • UPI: United Payments Interface (UPI) allows you to transfer funds from your smartphone. However, you will need to link your bank account to complete payments via UPI. Money is transferred directly from one bank to another.

 


Q1) What is United Payments Interface (UPI)?

A Unified Payment Interface (UPI) is a smartphone application that allows users to transfer money between bank accounts. It is a single-window mobile payment system developed by the National Payments Corporation of India (NPCI). It eliminates the need to enter bank details or other sensitive information each time a customer initiates a transaction.

Source: Making RuPay cards at par with Visa and Mastercard! Modi Govt looking out for various opportunities