RBI Monetary Policy: Proposes To Link UPI With Pre-Sanctioned Credit Lines From Banks
The proposal will allow UPI transfers to and from bank accounts with pre-sanctioned credit lines at banks.
The Reserve Bank of India has proposed to expand the scope of the Unified Payments Interface by enabling transfers on the network from pre-sanctioned credit lines at banks.
The UPI network will be able to facilitate payments financed by credit from banks, the RBI said in a press statement regarding the proposed change.
"This initiative will further encourage innovation," RBI Governor Shaktikanta Das noted in his statement, following the monetary policy committee meeting on Thursday.
The linkage of UPI with bank credit lines can reduce the cost of such offerings and also help in the development of unique products for Indian markets, the RBI said. "Detailed instructions in this regard will be issued separately."
The move to link UPI with credit lines from banks follows the linkage of Rupay credit cards with the payments network, which was permitted by the RBI in June 2022. The linkage of UPI with Rupay credit cards is in addition to the main facility of linking UPI with deposit accounts.
