Mumbai: Soon you will be able to deposit cash at Cash Deposit Machines (CDMs) using your UPI instead of needing an ATM/debit card. The Reserve Bank of India (RBI) Governor Shaktikanta Das on Friday during the unveiling of the first monetary policy statement for the fiscal year 2024-25 announced a proposal for UPI-based cash deposit facility. The RBI also decided to permit linking of Prepaid Payment Instruments (PPIs) through third-party Unified Payments Interface (UPI) applications. It also announced distribution of RBI’s e-rupee through Non-bank Payment System Operators.
The facility of cash deposit is presently available only through use of debit cards.
“Given the popularity and acceptance of UPI, as also the benefits seen from the availability of UPI for cardless cash withdrawal at ATMs, it is now proposed to facilitate cash deposit facility through use of UPI,” RBI Governor said.
At present, UPI payments from bank accounts can be made by linking a bank account through the UPI App of the bank or using any third-party UPI application. However, the same facility is not available for Prepaid Payment Instruments (PPIs). PPIs can currently be used to make UPI transactions only by using the application provided by the PPI issuer. “To provide more flexibility to PPI holders, it is now proposed to permit linking of PPIs through third-party UPI applications. This will enable the PPI holders to make UPI payments like bank account holders,” said the RBI.
According to Shivaji Thapliyal, Head of Research and Lead Analyst, Yes Securities, the wallet market has been thrown wide open due to the RBI diktat on Paytm Payments Bank.
“The RBI diktat had meant that the Paytm Wallet business would, effectively, close down. However, it would be interesting to see what scenarios could emerge if third party UPI apps, which would include Paytm, would be able to access other PPI wallets. The noteworthy monitorables in this regard would include (1) the commercials that the third party app would establish with the PPI wallet in terms of sharing the Merchant Discount Rate, if at all and (2) the extent of adoption allowed by merchants on the ground,” added Thapliyal.
