The UPI (Unified Payments Interface) has become the driving force of digital payment in India, where the ecosystem is expanding more rapidly than any time before. UPI is accepted from the street vendors up to the shopping malls. What a nice upgrade there is now-UPI is available on credit cards as well!
This is the new feature according to which the users can now make UPI on credit card, a combination of the convenience of UPI and the flexibility of credit. To know what this entails, the process of how it operates, and the advantages it has for users, we shall see.
What Is UPI on a Credit Card?
Previously, UPI payments could be associated with savings accounts or debit cards. However, nowadays, with the assistance of the Reserve Bank of India (RBI) and National Payments Corporation of India (NPCI), you can add your credit card to such UPI applications as Google Pay, PhonePe, Paytm, or BHIM.
This means that you can scan any UPI QR code and pay with your credit card limit as you would do with a debit card or bank account.
Simply put, it is like paying via UPI except that your wallet money is your credit card rather than your bank account.
UPI on a credit card: How does it work?
The following is the step-by-step procedure of UPI on a credit card:
1. RuPay Network:
Nowadays, UPI payments with RuPay credit cards are only permitted. Support with Visa and Mastercard will be introduced in the nearest future.
2. Linking Credit Card to UPI:
- Open a UPI app (such as Google Pay, PhonePe, BHIM, or Paytm).
- Click on Add payment method or Link credit card.
- Select your RuPay credit card and connect it with your UPI ID.
3. Make Payments:
- Scan any UPI QR code.
- Choose credit card as the mode of payment.
- Add the amount and UPI PIN and complete a transaction.
4. Transaction Limit:
The use of credit cards through UPI has transaction limits that are approved by RBI and usually carry a 5,000-10,000 per transaction limit that most users are allowed.
Advantages of Making Payments on UPI on Credit Card
1. Greater Sophistication of Payments:
Now you can use your credit limit to carry out daily UPI transactions even when your bank balance is low.
2. Reward Points & Cashback:
Keep on receiving reward points, cashback, or air miles on each UPI transaction done through credit card.
3. Wider Acceptance:
UPI QR codes are present virtually everywhere; even small traders now have a chance to accept UPI payments via credit cards.
4. Instant & Secure:
Payments can be made quickly, easily, and safely with the help of UPI PIN, which can authenticate transactions.
5. Promotes Cashless Economy:
This aspect will add more individuals to adopt digital payments to minimize reliance on cash.
Which banks have UPI on credit cards?
Some of the major banks in India have already begun to issue RuPay credit cards associated with UPI, such as
- State Bank of India (SBI)
- HDFC Bank
- ICICI Bank
- Axis Bank
- Punjab National Bank (PNB)
- Union Bank of India
- Bank of Baroda
These Rupay credit cards of these banks can be linked to your favorite UPI application.
Things to Keep in Mind
Although UPI on the credit cards is unbelievably convenient, it is important to note that users also could know several noteworthy details:
- Interest Charges:
Also, similar to the usual credit card dealings, when you fail to pay your bill on time, you will be charged interest on the unpaid balance.
- Merchant Restrictions:
Certain traders can also limit credit-based payments through UPI to evade processing costs.
- Responsible Usage:
As it is easy to spend money this way, it is necessary to manage your credit limit and not to spend too much.
- Security:
Do not disclose any of your UPI PIN or credit card information. Always use official UPI apps.
Future of UPI on Credit Cards
The UPI credit card introduction is a significant milestone in Indian fintech. It also fills this gap between online payments and spending on credit that provides unmatched convenience to the UPI users.
NPCI plans to add this feature to Visa and Mastercard credit cards in the near future and thereby reach out to millions of new users. This will also increase the cashless ecosystem and credit card usage in India.
Conclusion
The possibility of making point-of-purchase transactions with credit cards is a disruptive technology in mobile payments. It is a combination of the convenience and strength of UPI and provides one platform that offers flexibility, rewards, and convenience to its users.
Therefore, when you have a RuPay credit card, you can get the next level of smart payments by connecting it to your favorite UPI application today and tap, scan, and pay with credit!
