1675583418702_m.jpg)
ON WEDNESDAY, the Reserve Bank of India announced that it has decided to add a new feature in the Universal Payments Interface (UPI) platform, 'single-block-and-multiple debits'. This will allow a user to block funds in their account for a specific purpose, which can be debited whenever needed.
Simply put, a customer can create a payment mandate against a merchant by blocking funds in their bank account for specific purposes which can be debited, whenever needed.
How to use it and where
The single-block-and-multiple-debits feature will ensure timely payments for merchants while also allowing buyers to pay after receiving the goods. This will be particularly useful for e-commerce transactions.
Besides e-commerce, it will also be helpful in hotel bookings, investing in securities in the secondary capital market and buying government securities using RBI’s Retail Direct Scheme.
The potential
As of September 2022, there were 358 banks available on the platform with a monthly volume of 6.7 billion transactions amounting to Rs 11.16 lakh crore ($140 billion).
For Q3 of the current fiscal year alone, UPI-related transactions amounted to over 19.65 billion transactions in volume with a value of Rs 32.5 lakh crore Worldline India's 'Digital Payments Report'.
In the works
RBI Governor Shaktikanta Das said that a separate instruction will be issued to the National Payments Corporation of India (NPCI) to implement the enhancement.
Meanwhile, Das also announced an expansion in the scope of the Bharat Bill Payment System (BBPS) to include all payments and collections.
Currently, BBPS does not have any facility to process non-recurring payments or collection requirements of individuals even if they are recurring in nature, Das said, adding this results in professional service fee payments, education fees, tax payments and rent collections being outside the ambit of the platform.
The new system will make the BBPS platform accessible to a wider set of individuals and businesses who can benefit from the transparent and uniform payments experience, faster access to funds and improved efficiency, Das said.
Separate guidelines will be issued to NPCI Bharat BillPay Ltd (NBBL) regarding the same, he said.
(With inputs from PTI)
