The news: The National Payments Corporation of India launched e-RUPI, a prepaid digital payment system that lets government agencies and corporations send one-time payment vouchers to beneficiaries via SMS or QR code.
Here’s how it works: The vouchers can only be used by the recipient for a specific purpose, like payments for COVID-19 vaccinations. e-RUPI doesn’t require bank accounts, payment cards, or any other third-party payment tool—just an SMS-receiving mobile device.
The system operates within the Unified Payments Interface (UPI)—India’s instant mobile bank-to-bank transfer system. Eleven banks have already gone live with the service, including the State Bank of India, the nation’s largest bank.
Why this matters: e-RUPI expands India’s digital payments ecosystem—accelerating the country’s move away from cash.
Why this can succeed: India’s high mobile phone penetration will likely support e-RUPI adoption among consumers—the number of mobile phone users in India is expected to hit 863.9 million this year, 64.5% of the country’s population, according to Insider Intelligence forecasts.
Growing interest in digital payments among consumers in India can solidify e-RUPI’s success: A June 2021 report by ACI Worldwide found that 37% of consumers used digital payments via mobile wallets and UPI at least once a day, up from 29% six months prior. And since e-RUPI can deliver welfare payments to consumers, it will likely become an essential part of the country’s digital payments landscape—bringing India closer to being a cashless economy.