UPI PrePaid Voucher – Who will be the first Issuer?

UPI PrePaid Voucher – Who will be the first Issuer?

 

            NPICI UPI Team vide announced a new Digital Payment Channel in our country. This digital payment channel rides on the successful UPI Platform.

Two broad categories of UPI PrePaid Voucher are envisaged

Category 01) P2P i.e Person to Person

Category 02) B2C i.e Business to Consumer

As of now only the B2C process is released. The P2P process will follow at a later date

UPI PrePaid Voucher beneficiary need not have a bank account or be a UPI user. This is the most unique feature of the whole channel.

Immediate Use Case –

Future use cases, with focus on Covid19 vaccination are mentioned below

            8 Banks are Live as Issuers on UPI PrePaid Voucher platform. The Banks are

01)  Axis Bank

02)  Bank of Baroda

03)  Canara Bank

04)  HDFC Bank

05)  ICICI Bank

06)  Indusind Bank

07)  Punjab National Bank

08)  State Bank of India

5 entities are Live as Acquirers on UPI PrePaid Voucher platform. The Acquiring Entity / Apps are

01)  Axis Bank – Bharat Pe

02)  BOB – BHIM Baroda Merchant Pay

03)  HDFC Bank – HDFC Business App

04)  Punjab National Bank – PNB Merchant Pay

05)  SBI – SBI Yono Merchant

As of now, the UPI PrePaid Voucher can be redeemed only on the above UPI Apps. In the near future, more Apps may acquire UP transactions.

 

Visualization of process flow at the Acquiring Merchant

01)  Holder of the UPI Prepaid voucher approaches the merchant buys the services/goods and informs the merchant that he/she will pay via UPI Prepaid voucher

a)       If payment via UP QR Code – Buyer shows the UP QR Code on his/her smartphone. Merchant scans the QR Code via the UPI PrePaid Voucher acquiring App

ai) In the background, the transaction flows to NPCI, then to Issuing bank, if all well, authentication takes place and the UPI PrePaid Voucher amount moves from the UP to the merchant account

aii) This is a completely digital process, with minimal human intervention

 

b)      If payment via UPI PrePaid Voucher SMS String - Buyer shows the SMS String to the merchant. Merchant inputs the SMS String on the UPI PrePaid Voucher acquiring app.

bi) In the background, the transaction flows to NPCI, then to Issuing bank, if all well, authentication takes place and the UPI PrePaid Voucher amount moves from the UP to the merchant account

bii) This is a completely digital process, with minimal human intervention

The actual process flow will be known once UPI PrePaid Voucher redemptions start taking place

Apart from NPCI, there are 5 entities part of the UPI PrePaid Voucher process cycle

Issuer Bank (Issuer): Bank who shall initiate a request to create UP on UPI

Sponsor: A Corporate, Central / State Government Department, Business customer of the bank who 

PV (Prepaid) Voucher Beneficiary: The person to whom the UPI PrePaid Voucher is issued. A PV beneficiary may not be a UPI user or bank account  holder.

Designated Merchants: These are specific voucher acceptance points where vouchers can be redeemed / used.

Acquiring Bank: These are banks that provide facility/capability to designated merchants to accept UPI Prepaid voucher (String/QR) for redemption.

 

Future use cases based on Covid19 Vaccination

01)  Social Service organizations like Lions Club, Rotary Club, Vasavi Club etc in an attempt to encourage vaccination may offer UP say ranging from INR100/- to INR250/- to the vaccinated citizens, even though, citizens may get themselves vaccinated at Government centers.

As on date, Covid19 vaccines at Government Centres are free of cost.

The amount may vary, the amount mentioned here is just an example.

02)  Social service organizations, corporates or any other interested organization can directly sponsor Covid19 vaccines for a set of beneficiaries at private centers.

 

Future use cases:

01)  Scholarships

02)  Incentives

03)  Tax benefits vouchers

04)  Donations

05)  Subsidies

Read the complete UP NPCI circular @ https://www.npci.org.in/PDF/npci/upi/circular/2021/NPCIUPI-OC-No-112-UPI-Prepaid-Voucher.pdf

Disclaimer: These are my personal opinions only. The bottom line is Mission #LessCashNotCashLess. Nothing more – Nothing less.