As the digital world is continues to evolve, the Reserve Bank of India (RBI) recently introduced a new initiative as part of a broader effort to streamline and simplify small-value digital transactions.
This initiative by the RBI aimed at enhancing the convenience of digital payments. With this, customers will soon be able to automatically replenish their UPI Lite wallets and other prepaid instruments like like FASTag and National Common Mobility Card (NCMC) when their balances fall below a certain threshold.
What is UPI Lite?
Launched in 2022, UPI Lite enables users to make a quick and small value payments through an on device wallet.
Currently, the wallet can hold up to Rs 2,000 and facilitate a transaction up to Rs 5000 without adding a sector factor authentication. Moreover, this feature is aimed to reduce the load on the core banking systems and will also ensure a faster transaction processing. |
Extension to FASTag and NCMC
Apart from UPI Lite, this auto-reload feature will be extended to other prepaid instruments like FASTag and NCMC.
Representative Image | File
Sometimes, these instruments, for example, when used for toll payments or public transportation, often face issues of low balance leading to transaction decline. But by adding these e-mandate framework, a user can easily ensure that their automatically topped up, reducing the risk of other interruptions.
For FASTag and NCMC, currently, users recharge it manually but with this new auto replenishment facility, it will eliminate this manual recharge and ensure a smooth service.
Combating Cybercrime with AI/ML
Furthermore, alongside this advancement, the central bank is also looking forward to improve the security of digital payments. A committee led by A P Hota, former MD & CEO of NPCI, will establish a Digital Payments Intelligence Platform which will leverage artificial intelligence and machine learning to eliminate fraud risks, ensuring safer digital transactions.
The primary goal aim of this UPI Lite is to decrease the number of transactions that hit the bank's core system, according to Deputy Governor of RBI, T Rabi Shankar.
This decrease in the number of transaction will also minimise downtime and ensure more efficient processing for UPI transactions.
