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India is giving a major boost to merchant payments ecosystem with piloting proximity payment system in the country. National Payments Corporation of India (NPCI) is the umbrella organization for all retail payment systems in India, which aims to allow all Indian citizens to have unrestricted access to e-payment services.
NPCI has shortlisted three startups PhonePe, ToneTag along with Ultra Cash— for the pilot to allowing proximity payments through Unified Payments Interface (UPI), ET reported.
With the proximity payment consumer can do payments on any merchant outlets without any physical contact. This will increase security, ease of payments and stability for such transactions. It will also allow merchants to expand the base of merchants accepting digital payments since they will not need the additional expensive point of sales devices to be able to accept card or smartphone-based transactions.
“The pilot is being done within a closed user group at cafeterias and office canteens where the payments are being tested out. Once the stability and security of these processes are ensured, they could be tried on a larger scale as well before going live,” a person knows the matter said to Economic Times. “It is yet at a very early stage and will need time before going live.”
In the process, the merchant would enable his smartphone or mobile PoS to generate a voucher and accept payment from the customer. Further, the customer would need to identify the merchant through his phone and initiate a payment. Through the UPI channels, NPCI would eventually settle the transaction between the bank accounts of the two parties.
Image and Article Source: ET