RuPay

RuPay is a card payment network based in India. It is owned and operated by the National Payments Corporation of India (NPCI), a not-for-profit company owned by banks and set up at the initiative of the Reserve Bank of India. Indian banks issue RuPay debit, credit and prepaid cards, and merchants accept them at card terminals, online and at cash machines. The name combines the words rupee and payment.

RuPay is a domestic card scheme, comparable to national networks in other countries. It was created so that card transactions between Indian cardholders and Indian merchants could be processed within the country at lower cost, instead of relying wholly on international networks such as Visa and Mastercard.

NPCI was incorporated in 2008 to consolidate India's retail payment systems. It launched RuPay in March 2012, beginning with debit cards issued by public sector and cooperative banks. Growth accelerated from 2014 with the Pradhan Mantri Jan Dhan Yojana, a government program to open basic bank accounts for households without one. Each account came with a RuPay debit card, which put several hundred million cards into circulation and made RuPay the largest network in India by number of cards issued, although many of those cards are used rarely.

RuPay credit cards were introduced later in the decade. In 2022 the Reserve Bank of India permitted credit cards to be linked to the Unified Payments Interface, starting with RuPay, so that a cardholder can pay a merchant by scanning a QR code and have the amount charged to a credit line.

RuPay follows the four-party card model. A bank issues the card to its customer, another bank or licensed acquirer signs up the merchant, and NPCI acts as the network in the middle. NPCI operates the switch that routes authorization requests between acquirer and issuer, calculates each bank's net position and arranges settlement in rupees through accounts at the central bank. It also sets the operating rules, fees and security standards for members.

Cards use the EMV chip standard with a PIN, and newer cards support contactless payments. Online transactions require an additional factor of authentication, in line with Indian regulation, usually a one-time password. NPCI's cash machine network and its other systems share much of the same infrastructure and bank membership.

• Debit cards. The majority of RuPay cards are a debit card linked to a savings or current account, including those issued under government inclusion and benefit programs.
• Credit cards. Banks issue RuPay credit cards in several tiers, and these can be linked to UPI apps.
• Prepaid and special-purpose cards. These include gift and payroll cards, cards for farmers linked to crop credit, and the National Common Mobility Card, a contactless standard for transit fares and small retail payments.

RuPay has been used as an instrument of government policy on digital payments and financial inclusion. Since 1 January 2020, banks have not been allowed to charge merchants a merchant discount rate on RuPay debit card transactions, the same treatment given to UPI until October 2026, when a charge of 0.4 percent was introduced on UPI payments above 2,000 rupees to larger merchants. The government has at times paid banks an incentive to offset the lost income. The policy lowers costs for merchants, but banks and payment companies have argued that it weakens the commercial case for investing in acceptance.

The central bank has also acted on competition between networks. It has directed card issuers not to enter into arrangements that prevent them from using other networks and to give customers a choice of network when a card is issued or renewed. Its requirement that payment data be stored in India, an instance of data localization, applies to all networks but was easier for a domestic operator to meet.

A domestic network has no acceptance abroad on its own. NPCI addressed this through alliances with international networks. RuPay global cards can be used outside India on the networks of Discover, including Diners Club, and of JCB, and there is a similar arrangement with UnionPay. In these cases the foreign network handles acceptance and the transaction is passed back to NPCI and the Indian issuer.

NPCI's international subsidiary also signs direct agreements with other countries so that RuPay cards are accepted on local terminals, or so that local banks can issue cards on RuPay technology. Arrangements of this kind have been announced with several countries in South Asia, the Gulf and elsewhere, including Bhutan, Nepal, Singapore, Mauritius and the United Arab Emirates.

RuPay leads in the number of debit cards issued, but international networks hold a larger share of spending, particularly on credit cards and in e-commerce. Card payments as a whole have been overtaken in transaction count by UPI, which NPCI also runs. RuPay's link to UPI for credit transactions is therefore seen as its main route to growth, since it combines a credit product with the most widely used acceptance method in the country.

• RuPay
• National Payments Corporation of India