scorecardresearchLooking to make UPI payments through your credit card? Here's all you need to know

Looking to make UPI payments through your credit card? Here's all you need to know

Updated: 20 Oct 2022, 01:33 PM IST
TL;DR.
The method of connecting a RuPay credit card to UPI is quite similar to that of connecting a savings bank account or debit card to UPI. However, there are some limitations to the use of a UPI linked credit card. Read further to know about it in detail.
Transferring funds to small businesses in the P2PM category (P2PM is the NPCI classification for small businesses with a projected monthly inward UPI transaction of less than or equal to  <span class='webrupee'>₹</span>50,000) will not be allowed.

Transferring funds to small businesses in the P2PM category (P2PM is the NPCI classification for small businesses with a projected monthly inward UPI transaction of less than or equal to 50,000) will not be allowed.

The RBI permitted the linking of RuPay credit cards to UPI in June this year. The first three banks to launch UPI links were Punjab National Bank, Union Bank of India, and Indian Bank, and many more are anticipated to follow soon. In terms of expenditures, RuPay credit cards currently hold a one-fifth market share in India.

With this announcement, the use of credit card for making UPI payments will see an increase in the coming years. However, it is essential to know how to link your credit cards to the UPI app and make payments.

How to link your credit card to the UPI app?

The method of connecting a RuPay credit card to UPI is quite similar to that of connecting a savings bank account or debit card to UPI. Open the app and select the payment options. You may view any recently added bank accounts on the app. To add your card, click "Add credit or debit card." You must input the cardholder's name, billing address, CVV, expiration date, and card number. Select Save.

The terms and conditions of the issuer should be accepted. To begin paying at stores and merchants, click the 'Activate' button. Your card must be verified. For further authentication, a one-time password (OTP) will be sent to your registered mobile number. You can use your card to make purchases after having it validated.

Currently, the RuPay credit card via UPI is only available to specific bank customers via the BHIM app. Customers of Punjab National Bank, Union Bank of India, and Indian Bank will be the first to be able to use their RuPay Credit Cards with UPI on the BHIM App.

What are the limitations of the UPI linked credit card?

Only merchant payments may be made using RuPay credit cards on UPI. Because the RBI has approved the auto-pay option for recurring transactions of up to 15,000 without requiring an additional element of verification, customers may also utilize this new feature to pay their power or OTT bills or other regular merchant payments.

Additionally,it might not be possible to send money to any other UPI handle personally. For instance, you cannot use a RuPay credit card on UPI to send money to friends or family members who have formed their own UPI handles as individuals.

Furthermore, transferring funds to small businesses in the P2PM category (P2PM is the NPCI classification for small businesses with a projected monthly inward UPI transaction of less than or equal to 50,000) will not be allowed.

After taking this action, larger networks like visa and mastercard will be compelled to jump on the UPI bandwagon as well. MDR fees for non-RuPay credit cards can range from 2 to 3 percent of the transaction amount. RuPay-lower UPI's interchange cost will increase its appeal to the general public.

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First Published: 20 Oct 2022, 01:33 PM IST