Rupay, dubbed as India’s answer to MasterCard and Visa, is set to make its debut tomorrow. Bank of India will give the first batch of automated teller machines (ATM)-cum-debit cards to Unique Identification (UID) number holders in Pagdha village of Maharashtra’s Thane district.
The card, which will be given to ‘no frills’ account holders, can be used to withdraw cash from ATMs as well as from micro-ATMs, the hand-held devices with the bank’s business correspondents. However, for swapping the card in point-of-sale terminals at merchant establishments, customers will have to wait till the year-end.
RuPay card will have two identification features. The cardholder will have to provide the UID number for biometric identification for using micro-ATMs, while the PIN will be required for transactions via ATMs.
“Since these cards are Aadhar-based, we will issue these cards to around 90-95 people in the village who have already been allotted the UID numbers,” said A P Ghugal, general manager, Bank of India.
The bank plans to roll out these cards through each of its five sponsored regional rural banks by next month. Corporation Bank and Union Bank of India are next in line to issue the ATM-cum-debit RuPay cards.
To start with, banks are targeting semi-urban areas. “To make these cards functional, one needs data connectivity which is not available in rural areas, so banks are starting out with semi-urban areas for now,” said A P Hota, managing director and chief executive officer, National Payments Corporation of India (NPCI).
Backed by NPCI, RuPay card is a payment gateway and an alternative to the global real-time payment processing firms like Visa and MasterCard. “Premium payment service providers may not be interested in penetrating to the ground level. This is the value proposition that only RuPay offers. Initially, it will be helpful in filling up the gap and later on, it can be issued to matured customers in urban areas as well,” said Hota.
Since these cards are being issued to 'no frills' account holders for now, the limits for withdrawal and transactions will be in line with terms and conditions laid down by the banks on their respective 'no frills' accounts.
These cards cannot be used at point-of-sale terminals for now. "NPCI is working towards setting up the acceptance infrastructure for RuPay cards, which will be completed within six months. This will enable bank customers to use these cards at merchant establishments as well," said Hota. Debit card usage in India has grown rapidly. According to the Reserve Bank of India, the outstanding number of debit cards rose 25 per cent, while the volumes transacted jumped 46 per cent in 2010-11 compared to the previous year.
