Indigenous payment infrastructure

nitesh

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Payment gateway Rupay launched - Money Matters - livemint.com
National Payments Corp. of India Ltd (NPCI), jointly owned by banks, is the nodal agency to manage and promote RuPay

Mumbai: India on Monday launched an indigenous debit card payment network called RuPay to compete with multinational Visa Inc. and Mastercard Inc. and help banks reduce cost of issuing a debit card. It will also help in extending payment network in rural areas.

The card system, similar to China UnionPay network, was first envisaged by the banking regulator in 2005.

Five banks—State Bank of India, Bank of India, Union Bank of India, Bank of Baroda and Axis Bank Ltd—have been informally running this for months.

National Payments Corp. of India Ltd (NPCI), jointly owned by banks, is the nodal agency to manage and promote RuPay. NPCI manages the electronic payments in the country

A.P. Hota, managing director and CEO of NPCI, said 200,000 cards with the RuPay brand name have already been issued and the target is to have 10 million debit cards under the brand by March 2013.

He expects this to be used as a system for credit cards by March 2015. He also expects all public sector banks to join the system by the end of calender year 2012.

"Foreign card payment systems charge $50,000 as joining fees, but we will charge nothing. Since we are using indigenous technology and the transaction will be processed domestically, banks' cost will come down by 40% compared with international schemes," Hota said.

NPCI will charge 10 to 15 basis points (bps) of the transaction value as fees per transaction, almost half of what multinational payment companies charge, Hota said. One bps is 0.01%. "We are a not-for-profit company and we will ensure that these cards are issued by even the smaller urban cooperative banks and regional rural banks, which were so far kept out of the system," Hota said.

Indian banks will also save on foreign currency because the fees to international payment companies that were so far paid in dollars will now be paid in rupees, Hota said.

Reserve Bank of India (RBI) executive director G. Padmanabhan said the central bank will not endorse banks to choose the RuPay network. "Banks can choose what they want, but if the costs are so low, then obviously they will save a lot," he said.

India has around 260 million debit cards in use. Hota expects 50% of all debit cards to bear the RuPay name in the next three years. Consumers can use the RuPay based debit cards on the Internet from September.

[email protected]
 

nitesh

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This has to be aggressively pursued, I suggest along with this scheme, we should think of discontinuing of 500 and 1000 notes, keep only 20, 50 and 100 notes active, this will push people towards electronic transactions.

Multiple hits with one stone :D
 

LurkerBaba

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RBI should have enforced usage of RuPay. We shouldn't be overtly dependant on Mastercard/Visas's switching systems for monetary transactions
 

Adux

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We should not be a country which has to enforce anything. If Rupay has the reach, network, reliability and affordiability with respect to international players, then our people will only choose Rupay.

Also, how will this work when Rupay card holder travels abroad?
 

addiction

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Reserve Bank of India (RBI) executive director G. Padmanabhan said the central bank will not endorse banks to choose the RuPay network.
Can anyone throw some light on this statement?
 

SADAKHUSH

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A positive development which will save us foreign exchange and as well help us develop indigenous service industry which can be exported to neighbouring countries as well.
 

KS

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We should not be a country which has to enforce anything. If Rupay has the reach, network, reliability and affordiability with respect to international players, then our people will only choose Rupay.

Also, how will this work when Rupay card holder travels abroad?
You dont call it "forced"...you call it a gentle "nudge" to the people...;)

When the major banks automatically start issuing ATM cards in RuPay rather than Mastercard or VISA who will actually care for it ?
 

Mr.Ryu

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Thats good after thy freeze anonymous account we should teach them a lesson :p

INDIA is one of the top market they had and in coming years will be
 

Adux

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You dont call it "forced"...you call it a gentle "nudge" to the people...;)

When the major banks automatically start issuing ATM cards in RuPay rather than Mastercard or VISA who will actually care for it ?
Sorry I am a free capital market man and personal freedom advocate.
 

LurkerBaba

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The press and the media have ignored RuPay, which can bring about a revolution in India. But the ordinary bank customer can help spread the good word

The press and the financial and business channels have strangely consigned a great achievement of the Reserve Bank of India (RBI) to the inside pages and the "also ran" mentions at the end of news bulletins. It is the official launch of India's RuPay payment gateway and card which, except China, no other country, not even the European Union (EU) and Japan, has been able to start successfully.

The press and the media have not fully understood the implications of starting RuPay. Most importantly, it spells the beginning of the end for yet another dependency by India. In this case, it is freedom from the combined services offered by Visa, MasterCard and American Express, as well as the highly secretive payment processing companies like First Data Corp, Total System Services and others.

This short article does not provide the space to fully explain the extremely intricate and often hyper-secretive details of the payment processing industry. Suffice it to say that this is the next logical step to what RBI and its wholly-owned subsidiary, the National Payment Corporation of India (NPCI) has already done to establish control of ATM switches in India.

RuPay has, obviously, not amused the competition and here is why.

The payment processing industry had its roots in an attempt, soon after the Second World War, by governments, especially the US through the Federal Reserve, to exercise a greater control over their own economies. Very quickly, this became a focused attempt to control the economies of other countries too.


Ensuring that everybody else's payment processing industry did not survive was and is par for the course. Eurocard and JCB are just a few that fell by the wayside, were swallowed up, or were not able to really prosper.

The first signs of an attempt to bring India into the ambit of the US-backed payment processing industry came around 2000 AD, a couple of decades after the arrival of cards like Diner's Club, Gold Pass and some others. Initially these were for very limited Indian rupee payment-only kind of transactions, to dovetail with the requirements of foreigners who required their plastic to work in India. In just a decade after that, the grip of the US-backed payment processing industry, could be seen all over India.

Very soon, large segments of the Indian population, the swelling middle class and more, simply could not do without their plastic fix. Luckily, RBI saw the signs, and was able to control the ATM business before it grew too big. Today, our ATM business is Indian controlled and is setting benchmarks globally for technology. (Counterfeit currency is a separate issue.)

Around 2000 AD, the small tech company that I founded got involved with the US payment processing industry; at that stage it was variously explained to me how global dominance was an integral part of any aspect of the payment processing industry in the US.

I recall interviewing a best breed urbane youngsters in India with brilliant software skills around that time, who had no clue about plastic money, let alone possess plastic from their banks. Today, they are domain experts, and even a school student uses plastic.

This is not just a question of the few million dollars in fees that the payment processing industry collects. It is all about controlling the economy, controlling the float, by-passing the taxation system, keeping track of fiscal information of all sorts, and in short, running the money in somebody else's country.

It is Economics 101 for some, mystery for others, but dangerous all the same.

In addition, control over domestic and international transactions is where the real deep danger lies. All this, and more, was explained to us when we were working for the US payment processing industry.

Some of this was obviously shared with the domestic market. It has been a convoluted decade, moving from this level of lack of knowledge on the subject, to the pre-eminent position where India now has RuPay.

Every trick in the book, and more, was used to prevent India from developing RuPay—outright sabotage of efforts to go to RuPay (previously IndiaCard), co-opting those who would challenge RuPay (SBI Cards is just one example); even now attempting to portray the payment processing business as something that Indians cannot handle on their own.

Next door, the Chinese were moving ahead rapidly too. With China Union Pay (CUP), they extended their sphere of influence well past their domestic borders into the Pacific, the Central Asian countries, Africa and were on hand when the switch was pulled on Iran.


That CUP has a head-start of a few years on RuPay, and why, is something on which a book can be written—and which will make some of the multi-lakh scams look like so much loose change.

It behooves you as an Indian to find out from your bankers about RuPay—and see how you can be part of it. A rapid build-up of critical mass of users will be essential and very soon; in months probably.

An increasing number of ATMs from some banks—SBI, BoI, UBI, Axis Bank, BoB amongst them—already transact RuPay. Point of Sale machines are already in position, and the number is increasing.

Go to your bank today and find out about their involvement with RuPay you owe this to your country, and to the sovereign strength of the Indian economy as a whole and the rupees in your wallets and purses.

I do not want to be melodramatic, but the roots of slavery are born out of external forces controlling your domestic economy: it is as simple as that. That is the bottomline as far as the global payment processing industry is concerned. And in today's India, the stakes are very high, and we need to be part of this shake-up.

You can do much more than what some short article tucked away in an inside page can probably manage. Spread the word on RuPay; go ask your bank manager today.

RuPay: Your role to play - Moneylife Personal Finance site and magazine
 

nrj

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Screw Rupay & these ideas. Tell RBI to first fix the inane laws regarding Paypal.

Dumb 500$ transaction restriction along with bunch of creepy rules are troubling everyone for more than year now.
 
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Virendra

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You guys are doing transactions above 500$ each ? :shocked: ahaaaan ... ;)
 

JAISWAL

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President to dedicate indigenous card payment network 'RuPay'


NEW DELHI: President Pranab Mukherjee will dedicate India's own card payment network 'RuPay' to the nation here on Thursday.

The RuPay card is accepted at all ATMs (1.6 lakh plus), 95 per cent of PoS terminals (9.45 lakh plus) and most of the eCom merchants (about 10,000) in the country, an official statement said.

A variant of the card called 'Kisan Card' is now being issued by all the public sector banks in addition to the mainstream debit card which has been issued by 43 banks


President Pranab Mukherjee will dedicate India's own card payment network 'RuPay' to the nation here on Thursday.

A variant of pre-paid RuPay card would shortly be launched by IRCTC. More than 150 cooperative banks and the regional rural banks (RRBs) have also issued RuPay ATM card.

The total number of cards issued as on date is 17 million and is growing at a rate of about 3 million per month, the statement added.

RuPay, a new card payment scheme, is the coinage of two terms Rupee and Payment.

"This card symbolizes the capabilities of banking industry in India to build a card payment network so that dependency on international card scheme is minimized," it said.

'RuPay' is developed by National Payments Corporation of India (NPCI) - a 'not-for-profit' company envisioned by the Reserve Bank and created by the banking industry.

Source
 

Eastman

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Whats new in that? IMO Ru-Pay is already in service for a while :truestory:
 

LurkerBaba

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I'm surprised UPI (Unified Payments Interface) is not being discussed.

In a nutshell -
  • It can potentially disrupt how transactions are done. We can finally break free from Visa/Mastercard duopoly.
  • It has extremely low charges (rs 0.5 per transaction). Visa/Mastercard charge ~2% per transaction. Good for both sellers and customers
  • Its very well designed. Similar to IMPS minus the painful bits. This article explains it well https://razorpay.com/upi/
 

Bangalorean

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I'm surprised UPI (Unified Payments Interface) is not being discussed.

In a nutshell -
  • It can potentially disrupt how transactions are done. We can finally break free from Visa/Mastercard duopoly.
  • It has extremely low charges (rs 0.5 per transaction). Visa/Mastercard charge ~2% per transaction. Good for both sellers and customers
  • Its very well designed. Similar to IMPS minus the painful bits. This article explains it well https://razorpay.com/upi/
Highly optimistic assessment. Visa/Master cannot be compared with UPI. If anything, UPI might replace wallets - that too over a long long period of time.
 

LurkerBaba

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End of wallets ?

WhatsApp explores UPI for digital payments in India
Popular instant messaging app WhatsApp is exploring the unified payments interface (UPI) among other payment modes to launch its payment solution in India. The development comes about a month after WhatsApp cofounder Brian Acton had told ET's sister publication The Times of India that the Facebook-owned company was looking at the digital payments segment in India
 

amoy

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What's new?

E-wallet on Alipay {Alibaba's equivalent to PayPal} and weChat is widely applicable, in most shops, restaurants, and public transport throughout China.

Just with a scan of barcode (sometimes plus password input) the payment is effected.
 

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