RuPay is an Indian multinational financial services and payment service system, which functions as a domestic card network, similar to Visa or Mastercard. It is a concept and system owned by the National Payments Corporation of India (NPCI), which is the umbrella organization for retail payments in the country. The name is a portmanteau of "Rupee" and "Payment". RuPay was launched on March 26, 2012, to fulfill the Reserve Bank of India's (RBI) vision of establishing a domestic, open, and multilateral system of payments. The primary problem it solved was the dependence on foreign payment networks, which resulted in higher transaction costs and the routing of domestic transaction data outside the country.
The mechanism of RuPay involves domestic clearing and settlement, meaning all transaction data resides within India, leading to lower transaction costs for banks and customers. It offers complete interoperability and supports various products, including debit, credit, and prepaid cards, which are accepted at ATMs, Point-of-Sale (PoS) terminals, and e-commerce websites. A key connection is to the Pradhan Mantri Jan-Dhan Yojana (PMJDY) scheme, where RuPay debit cards were distributed to promote financial inclusion.
A significant recent change is the expansion of RuPay credit cards on the Unified Payments Interface (UPI), which allows customers to link their credit cards to UPI apps for transactions. This was enabled by the RBI and NPCI, with the framework for this expansion being a major regulatory focus in recent years. Furthermore, the Merchant Discount Rate (MDR) charges were eliminated for transactions done using RuPay debit cards from January 1, 2020, to encourage its adoption. Other recent developments include the enablement of pre-authorization for RuPay cards by March 31, 2024, and revised guidelines for complimentary airport lounge access for credit cardholders effective January 1, 2025.