PM Modi on Monday launched a digital payment system ‘e-RUPI’ based on electronic vouchers. This is India’s first step as the country’s own digital currency. E-RUPI is a cashless and digital payment system medium that will be received by the beneficiaries in the form of an SMS string or a QR code. It will be in a way similar to a gift voucher which can be redeemed at specific accepting centres without any credit or debit card or mobile app or internet banking.
Will play a role in promoting digital transactions in the country: PM Modi
PM Modi said at the launch that the e-rupee voucher will play a role in promoting digital transactions and DBT in the country. This will help in targeted, transparent and leakage-free delivery to all the people. He said that e-RUPI is an example of how India is progressing and connecting people in the 21st century with the help of advanced technology. Modi said he is happy that it has started this year when India is celebrating its 75th year of independence.
PM Modi said that not only the government, but if any non-government organization wants to help someone in his education or medical treatment, then they can use e-RUPI instead of giving cash. This will ensure that the amount donated is being used only for the stated purpose.
The platform has been launched by the National Payments Corporation of India (NPCI), Department of Financial Services, Ministry of Health and Family Welfare and National Health Authority. This system will be person-specific and purpose-specific. Through e-RUPI, the service provider can be connected with the beneficiaries and service providers without any physical interface.
This is how these vouchers will be issued
This system has been built by NPCI on its UPI platform and all banks will be e-RUPI issuing entities i.e. banks will issue it. Any corporate or government agency will have to approach the associate government or private bank regarding the specific person and purpose for which the payment is to be made. The beneficiary will be identified through the mobile number and the service provider will be allotted a voucher in the name of a particular person which will be delivered to that person only.
What will be the benefits of e-RUPI?
There is a system of education vouchers or school vouchers in America through which the government pays for the education of students. This subsidy is given directly to the parents for the specific purpose of educating their children. Apart from America, the school voucher system is also there in countries like Colombia, Chile, Sweden and Hong Kong.
- According to the government, welfare schemes can be delivered without any leakage through e-rupee.
- It can also be used for providing services under schemes like Mother and Child Welfare Schemes, TB Eradication Programme, medicines and fertilizer subsidy under Ayushman Bharat Pradhan Mantri Jan Arogya Yojana etc.
- According to the government, the private sector can also use these digital vouchers under its employee welfare and corporate social responsibility programs.
This is how e-RUPI is different from digital currency
The central government is working on the central bank RBI’s plan to bring digital currency and with the launch of e-RUPI, it will be possible to assess the potential for digital currency in the digital payments infrastructure in the country. At present, the rupee that we use for all transactions will act as the underlying asset for e-RUPI. The features of e-RUPI make it different from virtual currency and it is like a voucher-based payment system.