e-RUPI – Pros & Loopholes | Pros and Cons

What is e-RUPI?

e-RUPI is a voucher-based digital payment solution. Under this system, the Government will send e-vouchers to beneficiaries of welfare schemes. For example, let’s assume a beneficiary receives a vaccination benefit voucher. In this case, the benefit can be availed of only by the specified beneficiary, and only for the purpose of getting vaccinated at a healthcare centre/hospital.

So, e-RUPI is a voucher-based person- and purpose-specific digital payment solution. It aims at making sure the benefits reach the intended beneficiaries in a targeted and leakproof way. The issuer can track the usage of the voucher, ensuring the money has been spent for the intended purpose.

Things To Know About e-RUPI

1. e-Rupi is a person and purpose specific digital payment solution. It is expected to be a revolutionary initiative in the direction of ensuring a leak-proof delivery of welfare services.
2. e-Rupi is a symbol of how India is progressing by connecting people’s lives with technology, PM Modi said. It can also used for delivering services under schemes meant for providing drugs and nutritional support, Digital India stated.
3. National Payments Corporation of India (NPCI) in association with Department of Financial Services (DFS), National Health Authority (NHA), Ministry of Health and Family Welfare (MoHFW), and partner banks, has launched the – ‘e-RUPI’.
4. The users of this seamless 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, Digital India stated.
5. e-Rupi’s prepaid feature assures timely payment to the service provider without involvement of any intermediary.
6. Notably, e-Rupi would be shared with the beneficiaries by organizations or Government through SMS or QR code.
7. e-Rupi is contactless and keeps the details of beneficiaries absolutely confidential.
8. Meanwhile, transaction through e-Rupi is faster and reliable as the required amount is already stored in the voucher.
9. Beneficiary will not require to share personal details which redeeming the voucher and that’s why privacy is maintained.
10. So far, banks that are associated with e-Rupi are Axis Bank, Bank of Baroda, Canara Bank, HDFC Bank, ICICI Bank, Indusind Bank, Indian Bank, Kotak Bank, Punjab National Bank, State Bank of India, Union Bank of India.

How Does E-Rupi Works?

Users will get e-vouchers from the banks and institutions associated with E-Rupi. These vouchers are meant specifically for the user registered under the scheme. It works on both QR code and SMS methods to provide the direct benefit of welfare scheme services to the public.

In other words, E-Rupi eliminates the need for any intermediary between the transaction processes. This ensures the transparency of the government assistance programs that aim to reach people at ground level.

No use of digital payment apps or any kind of internet-based banking services will be required to avail benefits of these services.

Benefits and loopholes

Aimed at bridging the digital gap among the unbanked population, the beneficiaries or users of this payment mechanism will not require a card, digital payments app, or internet banking access to redeem the voucher.

e-RUPI transaction process is said to be secure and will be keeping the details of the beneficiaries completely confidential, maintaining their privacy.

The introduction of Covid vaccination voucher is also aimed at ramping India’s vaccination drive as e-RUPI allows beneficiaries to easily book appointments for the shots.

“The main objective and long-term vision behind e-RUPI is to reach 190 million unbanked citizens, fold them into a formal financial system, and close part of the digital gap. This digital payment system can provide equal access to financial, healthcare, and welfare services to each and every citizen of our country,” Hitesh Malviya, founder of itsblockchain.com, India’s first and oldest blockchain and cryptocurrency publication platform, told ThePrint.

However, with the beneficiary not required to disclose their identity, these vouchers are also likely to be claimed by other people.

“The government has maintained the privacy issue here but if the merchant doesn’t cross-check someone’s identity then anyone can claim these benefits,” said Harshit Sharma, COO of FinFloww, an upcoming voice-first platform aimed at making financial knowledge cool with the use of the latest technologies like AR and voice tech.

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