RUPAY PAYMENT GATEWAY | RUPAY INDIAN PAYMENT GATEWAY | INDIAN DOMESTIC PAYMENT GATEWAY

RuPay, a domestic payment gateway akin to global networks such as Visa and MasterCards.

Coming at an opportune time, when electronic payments are being seen as a tool to reach out to the unbanked, the RuPay card system — an initiative of the RBI-promoted National Payments Corporation of India — is creating unease among global card associations as it will reduce overall transaction cost for banks by introducing competition to international card schemes.
Recently, Visa invited some 50 Indian urban co-operative banks to make a presentation on its products with an aim to lure local lenders to join the global payments network. Visa’s efforts to connect with urban cooperative lenders, hitherto not a priority for card associations such as Visa and MasterCard, just five months ahead of the RuPay launch is being viewed by experts as prompted by fear of impending competition.

The RuPay system will also lower the cost of transactions for shops that are reluctant to use the electronic mode of payment on which they currently lose 1.5% of their margin. “Currently, the merchant fee is significantly high and there is room to bring it down,” says AP Hota, chief executive officer, NPCI. China already has its domestic payment network Union Pay, a benchmark against which RuPay may be compared. Union Pay has 200 member banks, including 30 outside China, and is accepted in 104 countries.