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India's 2 largest private sector banks have launched the "UPI NOW PAY LATER" facility this month. This means that you can now make UPI payments even if you do not have enough money in your bank account.
Image by starline on Freepik | Edited on canva
Since UPI (Unified Payments Interface) launched with 21 member banks in 2016, Its popularity has rapidly grown. According to an RBI report, UPI transactions reached a total of 139.2 trillion INR in FY 2022-23.
Do you know why? Because the advent of UPI has ignited a digital revolution in financial inclusion across India. The impact of UPI on cash transactions in India is significant. In view of all this, the 2 largest private sector banks (HDFC and ICICI) of the country have started the facility of "UPI now PAY later."
It basically is an overdraft facility offered to HDFC and ICICI bank account holders which can be utilized via any UPI app. To use UPI now PAY later you first need to activate the feature with your ban. Once you activate this feature on your UPI app, a new account gets created where a certain credit line will be assigned to you. After which you will be able to use your credit line to make UPI payments through your UPI app.
It is important to note that you can only make payments to merchants through this credit line opened under this facility. A one-time non-refundable processing fee of rupees 199+ GST will be charged at the time of this credit line activation.
Get a credit limit of up to rupees 50,000 INR with a maximum credit period of up to 6 months although the credit limit may vary from customer to customer as per their income and credit history. Just as the overdraft facility works in bank accounts similarly it will work in the case of UPI now PAY later. You'll pay interest only for the credit limit you utilize and for the number of days you use it and not on the entire amount.
This is really a great move by the banks. I myself feel that today as convenient, easy, and common as 'UPI' has become, paying in cash is equally difficult and troublesome. And for all those people who sometimes have to face difficulties in making important purchases due to low account balances, this facility will prove to be very useful for them. Also, this will promote UPI and digital payment systems everywhere in the nation, and then maybe people will become more aware and educated about it. Because some people with ill intentions are always trying to cheat you.
Therefore, I hope that along with the promotion of digital payment systems, the government should also run awareness campaigns for it. So that people do not get cheated, and even less educated people can also learn to use this system with ease and safety. Because when an innocent loses his hard-earned money due to fraud, then it becomes difficult to make him understand the importance of that thing again.