NEW DELHI, Aug 2: The Prime Minister Narendra Modi on Monday launched e-RUPI, an electronic voucher-based cashless and contactless instrument for digital payment system. It gets delivered to the mobile phones of beneficiaries through a QR code or SMS string.
The users of this new one-time payment mechanism will be able to redeem the voucher without a card, digital payments app or internet banking access, at the service provider.
The platform has been developed by the National Payments Corporation of India (NPCI) on its unified payments interface (UPI) platform, in collaboration with the Department of Financial Services, Ministry of Health and Family Welfare (MoHFW) and the National Health Authority.
The PMO in a recent statement said e-RUPI could be used for delivering services under schemes meant for providing drugs and nutritional support under Mother and Child welfare schemes, TB eradication programmes, drugs and diagnostics under schemes like Ayushman Bharat Pradhan Mantri Jan Arogya Yojana, fertilizer subsidies etc.
It added that even the private sector can leverage these digital vouchers as part of their employee welfare and corporate social responsibility programs.
Speaking at the launch of the new platform, Modi said the e-RUPI voucher would play a major role in strengthening the direct benefit transfer (DBT) scheme by the government. He further said e-RUPI would help in assuring targeted, transparent and leakage-free delivery for all.
Modi said e-RUPI was a person and purpose-specific payment platform. The prime minister further noted that technology was being seen as a tool to help the poor. He added that technology was bringing transparency in DBT.
Speaking on the adoption of technology, Modi said India was showing the world it was not behind in adopting new technology. Be it in terms of innovations or usage of technology in the delivery of services, India was capable of being a global leader.
He added that the government was using direct benefit transfer to provide benefits of 300 schemes ranging from LPG to ration to pension directly to beneficiaries.
“e-RUPI” is the first step towards having a digital currency in the country. e-RUPI is a cashless and contactless digital payments medium, which will be delivered to mobile phones of beneficiaries in form of an SMS-string or a QR code. This will essentially be like a prepaid gift-voucher that will be redeemable at specific accepting centres without any credit or debit card, a mobile app or internet banking. e-RUPI will connect the sponsors of the services with the beneficiaries and service providers in a digital manner without any physical interface.
The system has been built by NPCI on its UPI platform, and has on-boarded banks that will be the issuing entities. Any corporate or government agency will have to approach the partner banks, which are both private and public-sector lenders, with the details of specific persons and the purpose for which payments have to be made. The beneficiaries will be identified using their mobile number and a voucher allocated by a bank to the service provider in the name of a given person would only be delivered to that person.
According to the government, e-RUPI is expected to ensure a leak-proof delivery of welfare services. It can also be used for delivering services under schemes meant for providing drugs and nutritional support under Mother and Child welfare schemes, TB eradication programmes, drugs & diagnostics under schemes like Ayushman Bharat Pradhan Mantri Jan Arogya Yojana, fertiliser subsidies etc. The government also said even the private sector can leverage these digital vouchers as part of their employee welfare and corporate social responsibility programmes.
The government is already working on developing a central bank digital currency and the launch of e-RUPI could potentially highlight the gaps in digital payments infrastructure that will be necessary for the success of the future digital currency. In effect, e-RUPI is still backed by the existing Indian rupee as the underlying asset and specificity of its purpose makes it different to a virtual currency and puts it closer to a voucher-based payment system.
The Reserve Bank of India had recently said it had been working towards a phased implementation strategy for central bank digital currency or CBDC — digital currencies issued by a central bank that generally take on a digital form of the nation’s existing fiat currency such as the rupee.
In the US, there is the system of education vouchers or school vouchers, which is a certificate of government funding for students selected for state-funded education to create a targeted delivery system. These are essentially subsidies given directly to parents of students for the specific purpose of educating their children. In addition to the US, the school voucher system has been used in several other countries such as Colombia, Chile, Sweden, Hong Kong, etc.
(Manas Dasgupta)
