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NPCI launches offline payments feature for contactless RuPay cards

The National Payments Corporation of India (NPCI) has launched an offline contactless payments feature for RuPay cardholders, it said in a press release on Wednesday. RuPay cardholders can now make offline payments at point-of-sale (PoS) devices using Near-Field-Communication (NFC) enabled cards in areas with limited network connectivity, it said.

Over the last few months, there has been a push by the NPCI and the Reserve Bank of India to encourage digital payments in an offline mode, particularly due to network connectivity issues in large parts of the country. In August this year, the RBI issued guidelines to payment system operators allowing them to launch pilot programs for small value offline payments. Further, the RBI recently allowed two companies to conduct pilot tests for offline payments solutions under its regulatory sandbox, while the NPCI has partnered with companies like ToneTag and Gupshup to launch a feature-phone based payments solution that can be used offline.

The NPCI has also launched a re-loadable wallet for offline contactless payments via RuPay cards, whereby customers can store money in the wallet to make regular retail payments. The feature which is currently enabled for the National Common Mobility Card (NCMC) will be made available for regular retail payments on a pilot basis, it said. The RuPay NCMC offline wallet can be used to make payments for transit services metros, bus tickets or cab fares, for instance, which reduces the need for cash and eases the convenience of daily travel.

“We are delighted to unveil the new RuPay Contactless (offline) feature which is aimed at transforming the transaction experience for customers by deploying enhanced NFC technology and innovative card payment solutions. We are confident that with the advent of the stellar RuPay contactless (offline) feature, the acceptance infrastructure for RuPay will increase exponentially and will result in the rapid on-boarding on both merchants and consumers in various geographies across the nation,” said Nalin Bansal, head of RuPay and National Financial Switch, NPCI in a statement.

Further, with the RBI recently increasing the limit on contactless or NFC-based transactions to ₹5,000 from ₹2,000, transactions via RuPay whether online or offline are bound to grow significantly.

RuPay’s big push

RuPay is a domestic card network developed by the NPCI to take on global giants, Visa and Mastercard. As of January 2020, a total of 600 million RuPay cards have been issued by 1,100 banks, according to data on the RuPay website. The card network has gained prominence among Indian bank customers on the back of various government schemes including, Pradhan Mantri Jan Dhan Yojana, Kisan Credit Cards and Pradhan Mantri Mudra Yojana to name a few.

The NPCI recently set up a subsidiary, NPCI International Payments, to take the card network abroad and expand to foreign banks. Further, last month, the NPCI announced the second phase of RuPay’s expansion for Bhutanese nationals. In the first phase, visitors from India could access ATMs and PoS terminals across Bhutan through RuPay cards, while under the second phase Bhutanese card holders would be able to access the RuPay network in India when they visit.

Further, in an address at the 73rd annual general meeting of the Indian Banks Association, Finance minister Nirmala Sitharaman told bankers to discourage non-digital payments as much as possible and promote RuPay cards to make the NPCI an international brand. “RuPay card will have to be the only card you promote. Whoever needs a card, RuPay will be the only card you would promote and I would not think it is necessary today in India when RuPay is becoming global, for Indians to be given any other card first than RuPay itself,” Sitharaman said.

In August last year, the NPCI launched the card network in the United Arab Emirates across 175,000 merchant acceptance locations of 21 businesses and 5,000 ATMs in the middle-east country. The RuPay card network has also been introduced in the Maldives, Saudi Arabia and South Korea, while the NPCI has enabled the card to be accepted in Bahrain, as well. In February this year, India signed a deal to launch the RuPay card network in Myanmar. Further, in June this year, as part of India’s strategic ties with Australia the two countries plan to explore the possibility of launching RuPay in Australia.


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