How the new UPI feature makes investment, online shopping easier
Call it yet another move towards digitization or something else! The Reserve Bank of India (RBI) has now come up with two consumer-centric development updates related to Unified Payment Interface (UPI) and Bharat Bill Payment System (BBPS).
Call it yet another move towards digitization or something else! The Reserve Bank of India (RBI) has now come up with two consumer-centric development updates related to Unified Payment Interface (UPI) and Bharat Bill Payment System (BBPS). The UPI will now have a single block multiple debit feature and BBPS will now include a wider variety of recurring and non-recurring payments.
RBI Governor Shaktikanta Das announced the expansion of the scope of Bharat Bill Payment System, post three-day long Monetary Policy Committee's meeting. He said that the platform will be available for wider section of the economy and also announced the expansion of the scope of the BBPS to include all categories of payments and collections.
Mind you that the Unified Payments Interface (UPI) platform has emerged as the most popular retail payment system in the country. The need for further enhancing the capacity of UPI by introducing single-block and multiple debits functionality, enabling users to block funds in their account, which can be debited at the time of need, can therefore hardly be over-emphasised.
The latest move will enhance the ease of making payments for investments in securities including through the Retail Direct platform as well as e-commerce transactions. There is no doubt whatsoever that the RBI's announcement with respect to UPI payments and BBPS are encouraging in the payments ecosystem. The RBI's announcement around increasing the capacity of UPI by introducing single-block and multiple debits functionality, will enable users to block funds in their account, which can be debited at the time of need. This will make it more convenient to make payments towards investments in securities through the RBI's Retail Direct platform and e-commerce transactions.
Significantly, RBI has been working towards boosting the efficiency and effectiveness of BBPS, to facilitate and accelerate the adoption of cashless payments and today's announcement to expand its scope will further aid in increasing the accessibility for a wider set of individuals and businesses.
One has to keep in mind that India, as an economy, has already witnessed a rapid rise in the digital payments, logging 23.06 billion transactions amounting to Rs 38.3 lakh crore in the third quarter this year. According to RBI, over 70 lakh autopay mandates are handled every month and more than half of Initial Public Offer (IPO) applications are processed using the block feature of UPI.
RBI's recent efforts with respect to digital payments will certainly contribute towards the cashless economy imperative.
Monetary policy experts feel that it is very much needed to enhance the scope of UPI, by not only adding credit cards to it, or allowing to invest in government securities or apply for IPO or enabling UPI on a feature phone, but to allow more and more customer-centric UPI payment solution to benefit the common people and moving them towards digitalization.
It is expected that people, who were usually using cash or UPI for transactions will further use it for their investment needs or travel or hotel booking needs. The new move would certainly be helpful for hotel bookings, purchase of securities in the secondary capital market, besides the purchase of government securities using RBI's Retail Direct scheme, e-commerce transactions, and others.