RBI allows offline e-payments: All you

need to know

What is offline e-payment?

News:

Recently the Reserve Bank of India (RBI) introduced a framework

allowing offline e-payments to promote digital payments in rural
and small urban areas.

In India, RBI plays the role of a regulator concerning all types of

payments.

What is offline e-payment?

It is a type of digital payment which does not require internet or

telecom connectivity. In offline mode, payments can be made face to
face or by any means of proximity such as cards, wallets, and mobile
devices.

The scheme was being worked on by RBI as a pilot project since

August 2020; these transactions will not require the additional
factor of authentication. Since the payment will be offline, customers
will get 'alerts' after some time through SMS or e-mail.

This facility is mainly designed keeping in mind the small value

digital payment. In this payment mode, the limit per transaction will
be up to Rs 200 and its overall limit has been fixed at Rs 2000,
although money can be re-added to the account through online
mode only.

For this payment mode, first, the provisions of the circular issued by
RBI in this regard will have to be agreed upon. Offline payments can
be used only with the permission of the customers. With this move
of RBI, small digital transactions will be able to take place even in
inaccessible or internet-less areas.

Status of digital payment in India.

In India, 60% of the total digital payment transactions take place

through UPI.

According to the RBI report, digital payments have almost doubled

in the last 5 years.
According to a report by capital markets company CLSA, digital
payments in India will triple from $300 billion in 2021 to $1 trillion
by 2026.

National Payment Corporation of India (NPCI) is an umbrella

organization for digital payments in the country. It has been
established by RBI and Indian Banks' Association (IBA) under the
provisions of the Payment and Settlement Systems Act, 2007.

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