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RBI Launches UPI ‘Tap and Pay’ via RuPay Cards
The Reserve Bank of India (RBI) launches a ‘tap and pay’ facility for UPI transactions, in partnership with the National Payments Corporation of India (NPCI). The facility enables faster UPI payments via RuPay credit cards without the need for OTPs or QR codes.
UPI ‘Tap and Pay’ Facility:
| Dimension | Key Details |
|---|---|
| Working mechanism | The feature uses the point-of-sale (PoS) terminal’s internet connectivity, allowing a transaction to be completed even when the customer’s mobile device does not have internet access. |
| Payment limit | NPCI states the facility is currently available for transactions up to ₹5,000, and for higher-value transactions, customers have to enter their PIN. |
| UPI scale | UPI comprises about 85% of transactions as India’s dominant electronic payment system. |
| Issues in QR-based payments | Current QR-based payments can face issues such as poor network connectivity, difficulty scanning QR codes due to lighting conditions, and friction in completing transactions. |
| Fraud concerns | Fraud concerns include incidents involving theft or inadvertent sharing of OTPs and other authentication credentials. |
| Regulatory focus backdrop | The regulatory focus on reducing payment fraud and ramping up data security comes in the backdrop of slowly increasing AI-based security attacks on financial systems all over the world. |
| Other payment modes | Visa and Mastercard have introduced passkeys as an additional authentication mechanism; depending on the device and payment system, authentication can involve a PIN, fingerprint, or the method used to unlock a smartphone. |
| Mastercard feature | Mastercard has showcased its Consumer Device Cardholder Verification Method (CDCVM), which allows transactions to be authenticated through a device’s biometric capabilities, including fingerprint or facial recognition. |
| Amazon Pay | Amazon Pay accounts for less than 1% of UPI transactions, and has introduced a tap-and-pay facility for its partner merchants. |