RuPay

RuPay is an Indian domestic card scheme conceived and launched by the National Payments Corporation of India (NPCI).^[1] It was created to fulfil the Reserve Bank of India’s desire to have a domestic, open loop, and multilateral system of payments in India. RuPay facilitates electronic payment at all Indian banks and financial institutions, and competes with MasterCard and Visa in India.^[2] NPCI maintains ties with Discover Financial to enable the card scheme to gain international acceptance.^[3][4][5]

Background

The IndiaPay scheme was conceived by the National Payments Corporation of India as an alternative to the MasterCard and Visa card schemes,^[2][6] and to consolidate and integrate various payment systems in India. It was renamed to RuPay to avoid naming conflicts with other financial institutions using the same name.^[7]
RuPay is a portmanteau of the words rupee and payment.^[8] The colors used in the logo are an allusion to the tricolor national flag.
The RuPay card was launched on 26 March 2012. NPCI entered into a strategic partnership with Discover Financial Services (DFS) for RuPay Card, enabling the acceptance of RuPay Global Cards on Discover’s global payment network outside of India.^[9][10][11]
On 8 May 2014, RuPay has been dedicated to India by President of India, Pranab Mukherjee at Rashtrapati Bhavan, New Delhi.^{[12][13][14][15][16]}

Acceptance

RuPay cards are accepted at all automated teller machines (ATMs) across India under National Financial Switch, and under the NPCI's agreement with DFS, RuPay cards are accepted on the international Discover network.^[17] According to the data published by National Payments Corporation of India, there are around 145,270 ATMs and more than 875,000 point of sale (PoS) terminals in India under the RuPay platform. In addition to the ATMs and PoS terminals, RuPay cards are accepted online on 10,000 e-commerce websites.^[18] with the same PIN which they use for ATM transactions.^{[19][20][21][22]}
RuPay cards are accepted at all PoS terminals in India. To enable this, RuPay has certified 29 major banks in India to accept the RuPay card at their respective PoS terminals located at different merchant locations.^[23]

Banking

RuPay's Parent Organization, National Payments Corporation of India has been backed by 11 leading banks, of which 7 are public sector banks namely State Bank of India, Bank of Baroda, Punjab National Bank, Canara Bank, Union Bank of India, Andhra Bank and Bank of India; 2 private sector banks ICICI Bank and HDFC Bank with 2 foreign banks namely Citi Bank and HSBC.^[24]

Issuers

A sample of RuPay Debit Card

Banks in India are authorized to issue RuPay debit cards to their customers for use at ATMs, PoS terminals, and e-commerce websites. About 240 banks, including all major public sector banks, currently issue RuPay cards to their customers,^[25] and about 25 million cards have been issued as of March 2014.^[26] RuPay cards are also issued at about 200 cooperative and rural banks to promote financial inclusion.^[25]

Jan Dhan Yojana

RuPay cards got a major boost through the Pradhan Mantri Jan Dhan Yojana as RuPay cards were issued to all Jan Dhan accounts. In spite of the critics saying most accounts are dormant, RuPay cards are now widely used by Jan Dhan Card holders.
Until March, 2016, 178 million RuPay debit cards were issued under the Jan Dhan Yojana against 662 million debit cards issued by the banking industry. The NPCI held consultations with small finance bank licensees on the use of RuPay cards and is set to emerge as the dominant debit card with small finance banks.^[27]

RuPay EMV

NPCI has rolled out its chip card for high security transactions using EMV (Europay, MasterCard and Visa) chip technology, which is a global standard for debit and credit cards. RuPay chip cards have an embedded microprocessor circuit containing information about the card holder and because transactions are PIN-based rather than signature-based.^[28]

Market share

RuPay cards presently has over 36% of market share in Indian card payment scheme behind Visa which has over 50% of the market share. More than 20% of the transactions in India is done through RuPay cards in India today.^[29]

RuPay for farmers

RuPay also provides a unified "Kisan Card", issued by banks across the country under Kisan Credit Card, enabling farmers to transact business on ATMs and PoS terminals.^[30]
PUNGRAIN (Punjab Grains Procurement Corporation Ltd), pays commission agents through the RuPay Debit Card, and developed a commission agents network called the Kisan Arhtia Information and Remittance Online Network (KAIRON) with the help of the National Payments Corporation of India.^[31][32][33]
Kotak Mahindra Bank in partnership with RuPay rolled out an initiative for financial inclusion, where the dairy farmers across 75 cooperative societies of AMUL in regions of Burdwan and Hooghly of West Bengal will be able to get their payments directly into their account on the same day of sale of milk.^[34]
The same model is planned to be adopted in the state of Gujarat where 1200 cooperative societies comprising over 300,000 dairy farmers will be the part of the programme.^[34]