Prime minister Narendra Modi has launched the 1st digital payment system for India ‘e-Rupi’ on 2nd August 2021. There are many speculations about it and many doubts are there which needs be clarified like What is e-Rupi? How it is going to work? What will be its benefits? Is it same as other digital currencies like Crypto, Bit coin etc? Who get benefit from this? And what are the objective of the Government behind this? So if you also want to know about it then read this blog and we will try to explain it in simplest term for you.
What is e-Rupi?
Firstly e-Rupi is kind of electronic voucher based digital payment system, that means it needs no physical interraction. In the governmental term, it is a cashless, contactless digital payment medium which will be delivered to mobile phones of the beneficiaries in the form of SMS or QR Code. Thus by using this code the beneficiary can avail the particular service for which this e-Rupi has been issued. This e-Rupi will be Purpose specific and person specific.
Some features of e-Rupi
- It has been built by the NPCI (National Payment Corporation of India) on its UPI platform which is an Umbrella organization that controls all major retail payments in India. It is regulated by RBI (Reserve Bank of India).
- The salient feature of e-Rupi is that it doesn’t require any Application or specific software for it.
- The beneficiaries can be identified by the mobile number and the e-Rupi can be issued for them by the government.
- Not only government but also any private organization or NGO can use this to provide service to different group of people.
How e-Rupi will work?
It will be a prepaid service. Suppose a specific ministry wants to issue it for a specific group of people then that ministry will bear all the cost for it.
For example, assume this e-Rupi voucher has been issued to all the people Below the poverty line for the service of getting Sanitizers. Now this voucher will be sent to the mobile of these people and most importantly they don’t need any kind of internet banking or UPI based applications for collecting this voucher. Now these people can redeem this voucher from specific centers, which are accepting the e-Rupi. The money will be paid directly to the service provider centers by the government through bank transfers.
Objective of e-Rupi
- e-Rupi will ensure a leak proof delivery system in welfare service inside India. Earlier also the government had tried to make this welfare service leakage proof by sending money directly into the bank account of beneficiaries. But after sending money government was having no clue on how and where that money will be spent. So to fix this the E-Rupi will play a major role as it can only be used for that specific service only. This will help to stop the corruption to a greater extent.
- It can also be used to avail services like Nutritional support under Mother and child welfare schemes, TB eradication Programmes, Providing drugs and treatment under Ayushman Bharat Pradhan Mantri jan arogya yojana, providing fertilizer subsidies etc.
What is the significance of e-Rupi?
It will help to promote digital payments in India. Also it can recognize the potential problems which can arise in future when India will launch its own Digital currency.
Which banks are connected with e-Rupi??
State bank of India, HDFC Bank, AXIS, PNB, Bank of Baroda, Canara Bank, IndusInd bank, ICICI bank are connected to it, However other banks will also get linked to it later.
Other countries where such e-voucher is implemented??
In USA educational voucher is given to students or their parents. Also countries like Colombia, chile, Sweden, Hong Kong etc have implemented such school voucher system.
How it is different from other digital currencies?
As you have already read; e-Rupi is not a digital currency, rather it is digital payment system. Any other digital currencies like Crypto and Bitcoin need internet banking and some cash amount to be bought. But e-Rupi is a free service which doesn’t require any payments from beneficiaries. It doesn’t require internet banking, credit card or debit cards or mobile application to get the service.
Thank you for reading this blog. We hope that this was clear to you. Please comment your view on this E-Rupi, also like our FACEBOOK PAGE to stay updated.