The National Payments Corporation of India (NPCI) is introducing an exciting new feature that lets customers use their credit cards on UPI like a credit line. This new development follows the Reserve Bank of India’s (RBI) decision to allow banks to offer credit lines to customers through UPI, making digital payments in India even more versatile and user-friendly.
This feature is live on banks including Axis Bank, HDFC Bank, ICICI Bank, Indian Bank, and Punjab National Bank (PNB). Customers can get a pre-approved credit line and only pay interest on the amount they use. This means they can borrow money for purchases and pay it back later, just like with a traditional credit card.
Convenient ‘Buy Now, Pay Later’ Option
One of the best parts about this new UPI credit feature is that it lets customers utilize the ‘Buy Now Pay Later’ method in a more convenient manner. They can settle the payments at the end of a billing cycle, making it easier to manage their finances. This service is currently available only for in-store purchases, which is great for everyday shopping.
No Charges for Customers
Another big plus is that customers don’t have to pay extra fees for using this service. The shopkeepers cover the cost of the credit through fees they pay, so you can use the credit line without worrying about additional charges. This setup makes credit more accessible and encourages more people to use it.
The launch of this new credit-like feature on UPI is a major step forward for digital payments in India. It offers a flexible and easy-to-use credit option that enhances the overall UPI experience. This move is expected to boost UPI adoption even more, as both consumers and merchants see the benefits of this innovative payment method.
In short, the NPCI’s new UPI feature is set to change how people in India handle their money and make purchases. By offering a credit line that works like a credit card but without the immediate expense, this feature provides a convenient and cost-effective way to manage spending. As more banks and users start using this feature, it will likely become a key part of India’s digital payment system, helping more people access financial services and make payments more efficiently.
Related Read: What is Unified Payments Interface (UPI) and How Does it Work?
