Is India flirting with digital currency by introducing e-RUPI?
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The Indian government is constantly pushing towards the goal of a digital economy. The government has successfully implemented various digital steps such as Aadhar which is the world’s largest unique digital identity program which has over 1.2 billion registrations. UPI, E-KYC, Digi locker are few other digital innovations implemented widely and successfully across the country. The next member in this range of digital tech is e-RUPI – A cashless and contactless payment medium, launched by the Prime Minister of India on 2nd August.
What is e-RUPI
e-RUPI is QR or SMS-string-based prepaid voucher which can be redeemed at accepting centers without a need for mobile internet, credit or debit cards, bank accounts, or even a mobile application. This innovative model is essentially built to directly and digitally connect the beneficiaries with the service providers. It is built by the National Payment Corporation of India on the UPI platform. In simple terms, it is a cost-effective prepaid digital voucher redeemable at partnered centers.
Primarily e-RUPI is designed by the government to effectively deliver its welfare services and government schemes directly to the beneficiaries which ensure there will not be any leakages in the delivery process. The Government schemes such as farmer fertilizer subsidies, nutrition welfare schemes can now issue the e-RUPI voucher code to the beneficiaries mobile redeemable with the relevant service providers, it does not require the beneficiaries to have a bank account thereby enabling effective direct delivery to the targeted person.
Even though it is developed for welfare delivery it can also be used by the Private sector and corporations for employee welfare and appreciation programs.
The prelude to the central backed digital currency
e-RUPI model shares its similarities and lays the foundation for digital currency. At present, it acts as a prepaid voucher redeemable at a service provider but it is still backed by the rupees, this step can scale the gap that exists between the current traditional currencies to the digital currencies. The success of this model can lay the foundation for the user-to-user transfer of digital codes and can start a domino effect towards digital currency use.
So, in conclusion at its current form e-RUPI will ensure the smooth service delivery to the millions of benefactors relying on government welfare and incentives, assisting in poverty alleviation and financial inclusivity. In addition, it also opens up many doors towards digital payment practices which can transform India!
Read more about this on the below links,
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