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Feb 20, 2017 07:08 PM IST | Source:

BharatQR launch: Govt keen to on-board 50 banks, 1 mn merchants

Soon paying for your cinema ticket or buying prescription pills over the counter will become easier and less time conusming. In a move to make retail payments seamless, the RBI today introduced BharatQR or quick response platform.

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Soon paying for your cinema ticket or buying prescription pills over the counter will become easier and less time conusming. In a move to make retail payments seamless, the RBI today introduced BharatQR or quick response platform. 

Developed by Mastercard, Visa and National Payments Corporation of India (NPCI) which is the umbrella retail payment system of India, BharatQR will eliminate the use of card swiping machines. 

QR code or Quick Response code, is an arrangement of black and white lines or square blocks which are used to store information such as weblinks or a merchant's bank account details. Such codes on the products can be deciphered or read by a smartphone camera.

The customers can simply make payments by scanning the QR code and entering the transaction amount. The amount gets transferred directly from the bank account without the need of a swiping PoS machine.

Currently, the QR code-based acceptance systems in India are largely closed systems. It is allowed through the government’s BHIM application, which is limited to the bank account while BharatQR accepts all cards including debit, credit and prepaid cards.

BharatQR code will support Visa, MasterCard, RuPay and American Express cards.

The QR code recognises the bank account and IFSC code, UPI and Aadhaar number of the customer. In order to pay through BharatQR, bank apps will have to be updated on your smartphone. So far about 15 banks including State Bank of India, Axis Bank, ICICI Bank, HDFC Bank and Bank of Baroda are on board the government's QR platform.

AP Hota, CEO and MD of NPCI, said, “We want to get 50 banks in the next six months. Also, in the second phase of UPI, BharatQR will be adopted in the application, which is likely in a month and a half. This is the first country which has taken QR Code at a national scale with all networks and banks coming together.”

They plan to double the merchants on board to 1 million merchants under BharatQR by the year end.

Gandhi, Deputy Governor, Reserve Bank of India, said, "Innovative interoperable solutions, like BharatQR, that are easy to scale, provide a seamless customer experience, and above all are safe and secure, are essential to accelerating India’s transition to a less–cash society.”

Directed by RBI, the application was developed within about 60 days and happens to be the "fastest delivery of an idea", said Nanda Dave, chief general manager at RBI.

At present, e-wallet players such as soon-to-be payment bank Paytm enable transacitons through QR Code. Paytm offers QR code to retailers (largely smaller roadside shops and hawkers) where both the sender and receiver of the amount must have the Paytm mobile application.  The Vijay Shekhar Sharma-led wallet player also plans to invest Rs 600 crore in the next 10 months to develop a QR code-based payments solution.

“This application [BharatQR] can go beyond cards.  BharatQR provides an interoperable platform across banks, while a Paytm code is only bilateral (both merchant and customer need to have the app)…It is up to Paytm and such players to come on board if they want to. The customers’ trust with banks and their regulation will make the difference,” Hota added.

The MDR (or merchant discount rates) chargeable on a transaction will be similar to a debit or credit card. NPCI has asked the Reserve Bank of India to give merchants a further discount on their MDR because physical infrastructure will be made redundant.

Porush Singh, Division President, South Asia at Mastercard said, “It [BharatQR] will help drive the adoption of digital payments as it will provide a fast, convenient and secure payment solution for the consumers and a low-cost and an easy way to deploy acceptance offering for the merchants."

Mastercard has developed Masterpass QR, which is interoperable while Visa has mVisa, limited to Visa card holders through which most banks allow payments at present. 

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