The Indian government plans to establish e-RUPI, a digital payment system based on electronic vouchers.
Many countries, including the United States, Colombia, Chile, Sweden, Hong Kong, and others, are already implementing the voucher system.


 It is a cashless and contactless digital payment mechanism. It is a Quick Response (QR) code or SMS string-based e-voucher that is sent to the users’ mobile phones.

 Users will be able to redeem the voucher at the service provider without needing to utilize a card, a digital payment app, or online banking.

 It connects service sponsors with beneficiaries and service providers in a digital model, eliminating the need for a physical interface.

 The method also ensures that the service provider is only paid after the transaction has been completed.

 Because the system is pre-paid, it ensures prompt payment to the service provider without the need for an intermediary. Not the same as virtual currency.

 In practice, e-RUPI is still backed by the actual Indian rupee as an underlying asset, and the uniqueness of its function distinguishes it from virtual currencies and brings it closer to a voucher-based payment system.

Beneficiary Identification and Issuing Entities:

 In collaboration with the Department of Financial Services, Ministry of Health & Family Welfare, and National Health Authority, the National Payments Corporation of India developed the one-time payment mechanism on its Unified Payments Interface (UPI) platform and it has boarded banks that will be the issuing entities.

 Any company or government agency will have to contact one of the partner banks, which include both private and public-sector lenders, with the names of specific individuals and the purpose for which payments are required.

 The beneficiaries will be identified by their phone numbers, and a voucher provided by a bank to the service provider in the name of a certain individual will be distributed only to that person.

Government Sector:

 It is expected to enable leak-proof delivery of welfare services and can be utilized to deliver services under Mother and Child Welfare programs, Ayushman Bharat Pradhan Mantri Jan Arogya Yojana, fertilizer subsidies, and other schemes that give pharmaceuticals and nutritional support.

Private Sector:

 Employee welfare and Corporate Social Responsibility (CSR) programs in the private sector can benefit from these digital coupons.


 The government is already working on a Central Bank Digital Currency, and the launch of e-RUPI could reveal the holes in digital payments infrastructure that will be required for the digital currency ‘s viability.

Source: The Hindu
Syllabus: Governance (GS 2), Infrastructure (GS 3)

Download Yojna IAS Daily Current Affairs of 3rd August 2021

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