National Payment Corporation of India (NPCI) said there will be no charges on RuPay credit card with UPI Transactions upto Rs. 2,000
National Payment Corporation of India (NPCI) released a circular regarding credit cards. It states that if anyone uses UPI for transactions upto Rs. 2,000 then no charges will be levied on RuPay Credit Cards.
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| NO Charges For RuPay Credit Cards on UPI Transactions |
It means there will be no charge for Unified Payment Interface (UPI) Transactions. NPCI has made Rs. 2,000 upper limit for RuPay Credit Cards.
RuPay Credit Card was launched four years ago. All major banks are issuing the RuPay Credit Cards to account holders. These are for both retail and commercial segments.
Before the NPCI Circular, the Reserve Bank of India (RBI) has directed Banks to link RuPay Credit Cards to UPI. This facility will provide a seamless experience for customers.
Customers will be able to access more opportunities and facilities to use their credit cards.
On the other hand Merchants will.be benefited due to the increased buying of things by customers. This will further make the credit ecosystem with the facilitation of credit cards utilising QR Codes.
After this NPCI move, Credit Cards can be attached to Virtual Payment Address (VPA). VPA stands for UPI ID (Not Credit Card No.). This process will make a safe, transparent and fully secure payment transaction ecosystem in India.
"During credit card on-boarding on the apps, the device binding and UPI PIN setting process shall include and be construed as customer consent for credit card enablement for all types of transactions," a recent NPCI circular said.
This facility is also applicable for International Transactions. For this purpose, the present facility from the App will be applied to RuPay Credit Cards, NPCI Circular (4th October, 2022)
In this category, there will be No Merchant Discount Rate (MDR). These are not applied if the UPI Transaction occurs upto Rs. 2,000
"Nil MDR (no interchange, PSP & app provider charges) shall apply for this category up to the transaction amount less than and equal to ₹2,000'' said the circular.
In UPI Transaction, Merchants pay Merchant Discount Rate (MDR) charges to the Bank. Banks levies these charges for Merchants for accepting the payments from the customers via every transaction (Credit Cards, UPI, Debit Card payment) in their shops.
Right now, only three banks- Canara Bank, Union Bank of India and Punjab National Bank are issuing these RuPay Credit Cards to their customers.
Merchant Discount Rate (MDR) is the cost paid by a merchant to a bank for accepting payment from their customers via credit or debit cards every time a card is used for payments in their stores.
Presently, Canara bank, Punjab National Bank and Union Bank of India are issuing these cards.
On September 21, Reserve Bank of India (RBI) Governor, Shaktikanta Das launched the indigenous RuPay Credit card on Unified Payment Interface (UPI) ecosystem. Many analysts and experts believe this facility has a potential to leap the credit market exponentially.
To enable linking of credit cards on UPI, the ecosystem will have to enhance their tech platforms. While the issuers will enable linking of credit card accounts at customer’s end, the acquirers will enable the acceptance of linked credit cards at merchant’s end. The initial phase of operationalisation will provide learnings and critical inputs that can be used to fine tune the proposition in later phases to scale up the usage, the circular said.
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