RBI MPC Meet: The Reserve Bank of India on Thursday, February 10, announced that it has enhanced the cap on e-RUPI prepaid digital vouchers. At the bi-annual Monetary Policy Committee meet of the RBI, it was decided to increase the e-Rupi digital voucher cap from Rs 10,000 to Rs 1 lakh, governor Shaktikanta Das said on the day.
“The e-RUPI pre-paid digital voucher developed by the NPCI was launched in August 2021. The single use cashless payment voucher has a cap of Rs 10,000. It is now proposed to increase the cap of e-RUPI vouchers issued by the Central government and State governments from Rs 10,000 to Rs 1,00,000 per voucher and permit such e-RUPI vouchers to be used more than once (until the amount of the voucher is completely redeemed),” the RBI said in a statement after the MPC meet.
This will further facilitate the delivery of various government schemes to the beneficiaries more efficiently, the central bank said.
What Does the Move Mean?
While launching the service, the PMO said that e-RUPI system can be used for “delivering services under schemes meant for providing drugs and nutritional support under Mother and Child welfare schemes and TB eradication programmes”.
The increased cap would mean that these sectors can use the service in a vetter manner.
“e-Rupi application has largely been around lower-value Government to Citizen and Corporate to Employee use-cases, and enable delivery of targeted monetary benefits to individuals who are not very digital savvy,” said Harish Prasad, head of banking – India, FIS.
“With this, the scope of application of e-Rupi vouchers expands and deepens significantly across the board – be it targeted delivery of benefits/assistance to SMEs, medical benefits to citizens, or corporates offering benefits to employees,” he said.
“With expansion of e-Rupi acceptance, this also has the potential to make inroads into certain areas addressed by gift-cards and it would be interesting to watch out for a possible link, at some point, between the proposed Digital Rupee and the e-Rupi programs,” Prasad added.
What is e-RUPI?
Developed by the National Payments Corporation of India (NPCI) in collaboration with the Department of Financial Services (DFS), the Union Health Ministry and the National Health Authority (NHA), e-RUPI “is a cashless and contactless instrument for digital payment”, the Prime Minister’s Office (PMO) said. It is founded on the Unified Payment Interface (UPI) platform created by NPCI that allows seamless real-time bank transfers and payments in India.
e-RUPI is designed to be a person- and purpose-specific digital payments solution that seeks to ensure that government schemes reach “intended beneficiaries in a targeted and leak-proof manner, with limited touch points between the government and the beneficiary”.
The e-RUPI system relies on mobile phones and is intended to be a seamless, one-time payment mechanism. A beneficiary is to receive a QR code or SMS string-based e-voucher on her mobile phone which can be redeemed at the service provider — for instance a hospital or health centre — without the need for any card, digital payments app or internet banking access.