RuPay, India’s own payment system established by the National Payment Corporation of India (NPCI), is expected to get a major boost with the government’s financial inclusion drive that is set for a launch later this month.
Indian government has ordered public sector banks to issue RuPay debit card for every new bank account and INR5,000 ($81.68) overdraft facility as part of its ambitious financial inclusion plan.
NPCI managing director and CEO AP Hota was quoted by The Financial Express as saying: "We expect our card base will rise from around 24 million to 100 million in the next two years.
"However, it is going to be tough challenge to get new account holders use the RuPay credit card, especially in the rural areas."
As per the directive of the finance ministry, the Indian Banks Association (IBA) is charting a plan, under which two adults (husband and wife) in every household will be given a bank account with an overdraft facility of INR5,000 ($81.68) as well as a RuPay debit card with a personal accident insurance cover of INR1lakh ($1634).
Under the time-bound action plan, it is expected that approximately 120 million accounts in rural areas and 30 million in urban areas would be opened and about 50,000 new business correspondents would be engaged in rural areas.
Hota said that RuPay is poised to give a tough competition to international players like Visa and Mastercard.
Off late various countries have announced plans for their own payment systems. Russia recently announced plans to set up a new payment system to compete with international players. Kazakhstan also announced similar plans.