Page 34 - IMDR JOURNAL 2020-21

IMDR’s Journal of Management Development and Research 2020-21

Objectives: To study the overall effectiveness of are debit cards and Visa and Mastercard still hold
payment system Rupay and UPI, both developed by a strong hold in the credit card section, both these
India and which are now accepted worldwide. The competitors have their own customer segmentation,
Rupay is the first domestic card system and UPI the while Visa and Mastercard issue to high rated
platform for all electronic transaction carried out transactions, and RuPay is more oriented towards
through online applications. customers with mid-range transactions. According
to Retail-Payment-Statistics published by NPCI for
Methodology: We have used secondary data the FY 2020-21
for this research work including journals, published
articles in various newspaper and information Sr. NPCI Operated
available on related websites No. Systems F.Y-2020-21

Volume Value (in
Financial Inclusion Through RuPay Card Financial Txns: (in Mn) Bn)
RuPay Card
RuPay is an indigenously developed card payment 1 usage at (POS) 556.91 922.05
system, which derives its name from the word
“Rupee and Payment” emphasizes that it is India’s 2 RuPay Card 572.28 732.03
very own initiative for card payment. RuPay card is usage at (eCom)
widely used for the financial inclusion of rural sector
through the Pradhan Mantri Jan Dhan Yojana, apart Table 1. https://www.npci.org.in/statistics
from that it also caters to various needs of the other
sections of the society. It is accepted internationally, Rupay has also benefited to the banks as they have
POS, E-commerce websites and with the advent of lower transactional cost as all the RuPay transaction
new technology can also be used for contactless POS are settled within India and banks don’t need to pay
machines also. It also provides various privileges any affiliation fees for this payment system. Also,
such as accidental insurance, cashback offers and the affiliation with any of the international card
merchant offer. system like VISA and Mastercard all the transactions
have to be routed outside the country even the

RuPay has Visa and Mastercard as its global domestic transactions, Now, with this indigenous
competitors, As of November 30, 2020, RuPay’s payment system, for clearing and settlement of
market share has increased to more than 60 per cent each transaction, Indian banks will have to pay
of total cards issued, from merely 17-per cent market 40% lower fees in RuPay platform compared to
share in 2017, around 603.6-million RuPay cards other international platforms. As all the transaction
have been issued by nearly 1,158 banks revealed the carried out by RuPay Debit card are processed and
data released by the Reserve Bank of India (RBI) in settled within the country so the transactional cost
its booklet on Payment Systems in India (2010-20). is also reimbursed in domestic currency which saves
These statistics should also be looked as the majority the foreign currency for the nation.
of them are debit cards issued by the bank against
the Pradhan Mantri Jan Dhan Yojana which leads
to its penetration to the interior of country. After the Benefits of using RuPay Debit Card
demonetisation that took place in 2016 there was a 1. It offers privileges at domestic and
need for digitised payment system in the rural part international airport lounges.
of the country as the use of card as a medium for 2. RuPay debit card holder are eligible for
payment was not frequent, as of January 13, 2021, accidental insurance cover of Rs. 2 lakhs
more than 306-million RuPay cards have been issued 3. The user can avail the discounted offers at
to 416.5 million accounts opened under PMJDY. The different merchant POS and also by many e
government is providing good incentives to the banks commerce platforms with a wide category from
to provide RuPay debit card as the first preference to lifestyle, Jewellery, Retail provided by domestic
the account holder, there is no fees charged to the and international service providers.
bank to join this platform. Majority of Rupay cards 4. RuPay transactions are fully operated within

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