Now, you can have the convenience of keeping all your daily life transactions at one place so your savings account statement is not getting flooded and also your bank balance is no longer at risk of being prone to fraud, scam etc
UPI QR code at a merchant outlet will allow you to pay in two ways from April 1, 2023. You can either continue to pay directly from your bank account or you can pay from your pre-paid mobile wallet such as Paytm and MobiKwik. This is because National Payments Corporation of India (NPCI) has permitted the Prepaid Payment Instruments (PPI), such as mobile wallets, to be part of interoperable UPI ecosystem. It is for these wallet transactions via UPI, 1.1 per cent interchange fee has been introduced by NPCI on merchants for P2M transaction above Rs 2,000, and there is no charge on customers. Your bank-to-bank account transactions on UPI, however, remain fully free.
So what are the benefits of paying through the prepaid wallet and not directly through your bank account via UPI QR code. Firstly, there are a lot of small transactions that happen in our daily lives and all these transactions are reflected in our bank statement. So, now you can have the convenience of keeping all your daily life transactions at one place so your savings account is not getting flooded.
Upasana Taku, Chairperson, Cofounder & COO – MobiKwik explained: “It is not just a question of the bank statement flooding. It is also the fact that a transaction goes through through multiple points and also the fact that every time you make the payment you actually enter your PIN for your primary savings account. So you’re putting your bank balance at risk because of fraud, scams etc that are happening. So this is a simple way for people to be able to pay more swiftly and in a convenient manner.”
Another important thing is the fact that a wallet can be loaded via multiple payment methods such as credit cards or bank account via UPI. You can avail the facility of credit card (fees attached) and not solely depend on your bank account in case of any money shortage while buying at the merchant outlet.
“So, if you just take a very simple example of credit card today. If you go to a small town Kirana store, they don’t have a POS machine. They don’t have a card machine. They have a UPI QR so you can scan and pay with your bank. But what if you want to pay using credit card. There is more power in the hands of user therefore, it is better for the user,” said Taku.
Will merchants be willing to pay the interchange free? “These new transactions will be incremental for the merchant. Now he’s getting access to other payment methods which people can use via wallet to pay him and I think that will really help in case of smaller cities and towns and villages of India, where people are travelling and they don’t have cash. And they want to use other payment methods and they are stuck. So now they have access to other things,” said Taku.
Traditionally, the most preferred method of UPI transactions is linking the bank account in any UPI enabled app for making payments which contributes over 99.9 per cent of total UPI transactions. But now, Taku said, the numbers will start growing for the wallet business using UPI ecosystem.
“We have moved 150 merchants to the interoperable UPI wallet QR code and most of them are very happy and elated about it. And we are also working very rapidly in rolling it out. We have given orders for lakhs of QR codes because these are absolutely new QR codes. We will be moving all our proprietary QR codes to the interoperable UPI wallet,” said Taku.
