Nearly a year after the soft launch as a limited-service debit card, the Rupay Card, which is the domestically developed equivalent of the Visas and MasterCards of the world, will offer full-service debit card services by the end of this fiscal. "We hope to commercially launch the Rupay Card before the end of this fiscal. We will be equipped to offer full service debit cards to our mainstream partner banks by February or March next," National Payments Corporation of India (NPCI) MD and Chief Executive Abhaya Prasad Hota told PTI. "By then, we hope to integrate our software with the nearly 4.5 lakh merchant terminals across the country," he said. NPCI, set up by the Reserve Bank, has developed the Rupay Card in April. In 2009, RBI had asked the Indian Banks Association to launch a not-for-profit company and design a rival card to Visa and MasterCard. China has already developed a similar card called the Union Pay of China. Since April, the Rupay Card has been in use, mostly by rural and urban cooperative banks offering limited service. NCPI has so far roped in four banks -- two urban cooperative banks, one regional rural bank, and one mainstream commercial bank, Bank of India, which has issued this card to its financial inclusion customers. Hota said that five more banks, including mainstream banks like Corporation Bank and Syndicate Bank, are testing the card now and the former will complete the process by next week. The Rupay Card, once commercially launched as a full service debit card, would eventually replace global real-time payment processing leaders--Visa and MasterCard --from the domestic payment system, the NPCI head said. Hota further said that leading financial consultancy firm Ernst & Young India is assisting NCPI in developing and rolling out the national payment switch (NPS) software that is needed for the commercial launch. The member banks have already invested around Rs 100 crore so far in the project. Of this, Rs 60 crore have gone into developing the Rupay Card and building the NPS network, Hota said. Hota also said he does not have immediate plan to enter the credit card space, saying that will involve tying up with external payment gateways, which would push up charges. "Hopefully we may be able to do that from the fourth year onwards. But our priority is the debit card segment now. Also, the full service debit cards will be only domestically operable as international debit cards will be costly for the banks." But he pointed out that as much as 95% of the debit card transactions are done within the country only. Another area that NPCI is evaluating is the pre-paid cards market, which include travellers cards, gift cards and salary cards. As per the latest RBI data, debit card transactions rose 45.6% in June to Rs 3,784 crore in June from Rs 2,597.5 crore y-o-y. There were over 23.95 crore debit cards in use in the country as of June 30, up 24.8% over 19.19 crore in the year-ago period. Against this, credit card transactions rose 30% in the month to Rs 7,191.11 crore, from Rs 5,538.75 crore y-o-y, despite a 6.7% drop in the number of credit cards in circulation to 1.76 crore during the month. As per the data, credit card deals during the first quarter of this fiscal stood at Rs 22,127.5 crore, as against Rs 16,948 crore y-o-y, a jump of 30.5%. In 2010-11, transactions through credit cards went up 22.15% to touch Rs 75,516 crore, while debit card transactions rose 46.46% to Rs 38,692 crore. NPCI is registered as a company with nine public sector, private sector and foreign banks owning stakes. RBI will oversee its operations in initial years, but will be regulated by RBI throughout.
Moneycontrol
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