e-RUPI is a cashless and contactless instrument developed by the NPCI on its UPI platform. It is essentially a digital voucher that a beneficiary receives on his phone in the form of an SMS string or QR code. As it is a pre-paid voucher, the entire transaction is contactless, quicker and more reliable.
As a customer who is issued/provided with e-RUPI voucher, there is no requirement of having any banking accounts, digital wallets or even internet! The beneficiaries will not be required to share any personal information during the transaction which makes the process secure.
From the government’s end of rolling out benefits targeted at its citizens under its various welfare schemes, it will ensure last-mile delivery of the financial benefits with effective tracking and reconciliation mechanism. This would enable multi-fold advantages like preventing mis-direction of funds provided for a particular reason, fraud and embezzlement by middlemen and intermediaries and delay in delivery of benefits as per welfare scheme objectives.
e-RUPI takes advantage of the fact that 79% of Indians have a mobile connection. This digital solution is intended to bring the unorganized segment into the economic system and strengthen economic activity.
e-RUPI could also make credit easily accessible for the MSME segment. Many of the subsidies extended to MSME and rural India (particularly farmers) do not reach them due to the threat of leakage primarily due to intermediaries. Many MSME operators are unaware of the welfare schemes available to them or are unsure where to obtain the benefit. A digital payment solution like e-RUPI eliminates such obstacles.
Any corporate or organization be easily get onboarded as a payer and issue their own vouchers on e-RUPI. It can be potentially used by the corporates and organisations for purposes like:
- Corporate gifting
- Transit/payroll cards
- Forex travel cards
- Well-being subsidies
- Educational assistance funding
- Increased transparency to their CSR funds utilisation, and
- Bring more ESG compliance
Corporates can track the voucher redemption process and can ensure that the funds were used for the specified purpose with which they were provided in the first place in a seamless manner.
However, this might affect corporate benefits distributing organisations like Sodexo which might see its corporate kitty to be diverted towards issue of purposes specific e-RUPI.
In India, e-RUPI can be used to distribute Direct Benefit Transfer (DBT) schemes. In India, such schemes touch the lives of millions of people and provide a lifeline for the majority of them. A total of over 18 lakh crores is currently being disbursed directly into the Aadhaar linked accounts of beneficiaries across the country for 311 schemes from 54 ministries.
The deployment of e-RUPI puts India another step further to digital governance. A person-specific and purpose-specific digital payment system will allow sponsors’ benefits to be distributed in a leakage-proof manner.
