Also read: Indians propel Google Pay, PhonePe as top fintech downloads in Feb 2020
The NPCI launched the recurring payment facility on July 22 with large banks like HDFC Bank, State Bank of India and Axis Bank. The long-awaited payment feature allows recurring payment mandates to be set by a UPI user by just authenticating the transaction through the UPI pin. As per regulatory norms, the NPCI-developed instant payments system can allow recurring payments of only up to Rs 2,000.“UPI auto-debit feature will transform recurring payment facilities and help merchants ease up the payments process, there are more than 10 banks which have started this. More will be joining the ecosystem,” said the second banker.Google Pay and PhonePe being two of the largest payment applications can bring in a large number of users in one shot, he added. Both the apps have a user base in the 60 to 70 million range, as per industry estimates.
For the auto-debit feature, users will need to authenticate the mandate once through a pin and after that, depending on the period chosen, the transactions will be processed regularly.
Moneycontrol wrote on May 27 how multiple payment applications were scaling up their partnerships with non-banking finance companies to process their monthly EMIs and were building up to the recurring payment solutions. PhonePe had told Moneycontrol it was working with more than 35 lenders and planned more such partnerships. While the platform didn’t support recurring payments, it was a feature the company was planning to add, the Bengaluru-based firm had said.The two bankers said the auto-debit feature would not stop only at EMIs, partnerships would be expanded to mutual fund companies, insurance firms as well since all SIPs, small-value insurance premiums and others could be paid through the UPI recurring payments mandate.“The user restriction is the Rs 2,000 limit but I believe as the system stabilises, the regulator will increase the limit as well,” said one of the bankers.In July, UPI recorded almost 1.5 billion transactions supporting the settlement of close to Rs 3 lakh crore, the latest NPCI data shows. It has emerged as one of the fastest-growing digital payment modes in the country and has attracted the attention of global technology players like Amazon, Google and Facebook. Now with recurring payments opening up on UPI, the volumes are expected to shoot further.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
