Prime Minister Narendra Modi on Monday launched eRUPI, a person and purpose-specific digital payment solution that is aimed at improving transparency and targeted delivery of benefits.

Over the years, several programmes have been launched to ensure that the benefits reach its intended beneficiaries in a targeted and leak-proof manner, with limited touchpoints between the government and the beneficiary. The concept of electronic vouchers takes forward this vision of good governance.

The e-RUPI platform has been developed by the National Payment Corporation of India (NPCI), Department of Financial Services, Ministry of Health and Welfare and the National Health Authority.

How does it work?

e-RUPI connects the sponsors of the services with the beneficiaries and service providers in a digital manner without any physical interface. It also ensures that the payment to the service provider is made only after the transaction is completed.

Since it is prepaid in nature, it assures timely payment to the service provider without the involvement of any intermediary.

The one-time payment mechanism of e-RUPI will allow users to redeem the voucher without a card, digital payments app or internet banking access, at the service provider.

It may be noted that the digital payment solution has been built by NPCI on its UPI platform.

Many banks have been onboarded for issuing e-RUPI vouchers. Corporate and government agencies will have to approach partner banks — both private and public-sector lenders — with the details of beneficiaries and the purpose of the payment. As of now, there are a total of 11 public and private sector banks that will support this new payment mode.

State Bank of India (SBI), ICICI Bank, HDFC Bank, Punjab National Bank (PNB), Axis Bank and Bank of Baroda will provide both issuance and redemption facilities for e-RUPI coupons. Meanwhile, Canara Bank, IndusInd Bank, Indian Bank, Kotak Mahindra Bank and Union Bank of India will only issue e-RUPI coupons for now.