New Guidelines Issued by NPCI for UPI – Based Cash Withdrawal at Kirana and Local Retailers

National payments corporation of India states new guidelines for UPI - based cash withdrawal at Kirana and Local retailers.

Retail payment organization NPCI (National payments corporation of India) states new guidelines for UPI based cash withdrawal, which are exactly like the Cash-at-PoS model as permitted by RBI.


UPI based cash withdrawals through debit cards soon at merchant shops

UPI Cash Withdrawl

The Reserve bank of India had asked the banks to extend the facility of cash withdrawal through debit cards to be made available at the merchant shops. NPCI is setting out similar guidelines for UPI – based digital payment players offering the use-case to its customers.


Why is this implemented?

UPI cash withdraw

Recently Bengaluru based PhonePe has launched its “PhonePe ATM” service, which allows the user to locate all the nearby stores, where the users can go and make P2P transfers to shop owners and get physical cash in return.

Announcing the services in January, PhonePe said that this is entirely based on the rail of Person to Person payment transfers to shop owners and get physical cash in return.

NPCI is all set to extend the existing Cash-at-Point of sale (POS) model use case to its UPI platform.


How will the new guidelines help?

Controlling the Fraud: To control the misuse of the new facility, the per-transaction withdrawal limit is capped to Rs 2,000, where total withdrawals are capped to three transactions per day, which is permitted to each customer.

NPCI will allocate a separate Merchant Category Code to this transaction, MCC classifies a business by the types of goods or services it provides or accepts.

Third-party app providers are expected to add a specific transaction in the UPI-enabled application and push the separate MCC allocated by NPCI for transactions involving cash Withdrawal.


Interchange Fee to be charged!

The new regulation has an Interchange fee of 0.5 percent of the transaction value would be charged, which is currently capped to 5 Rs. Further, the service provider can decide to charge up to one percent of the transactional value, which would be capped to Rs 10.

The Interchange fee is the transaction fee that is made by the remitter’s or customer’s bank account to the beneficiary’s or merchant’s bank.

+ posts

An enthusiastic content writer with zeal and impetus to work towards excellence

Disclaimer: The views, thoughts, and opinions expressed in the article have been curated for our audience and does not warrant a 100% accuracy. All the information mentioned in the article is subject to change according to the changing viewpoints. Feel free to reach us at [email protected] for any change or copyright issues.

Note: If you buy something via a link on this page, we might earn a small commission on it.

Deepish Mahajan
Deepish Mahajan
An enthusiastic content writer with zeal and impetus to work towards excellence

Leave A Reply

Please enter your comment!
Please enter your name here

related stories

This guide will help you decide when to opt for an in-house team or outsource certain business functions.

Business Dilemma: Outsource a Function or Keep it In-House?

All startups, including the most successful unicorns, were first merely a potential business idea. However, having a breakthrough idea is not enough for a...

Popular Trends: Minimalism, Pine Needle, Rewilding, and Niche Adventure Sports

Minimalism is More Popular Than Ever  Having less and doing less, in other words, minimalism has been gaining popularity over the past few years, as...
LinkedIn is a powerful networking, content marketing, and lead generation tool. Here's your guide to leverage it to its fullest extent.

LinkedIn Marketing: Leveraging LinkedIn to Grow Your Brand

We have frequently talked about how marketers can leverage different platforms across the web to grow their businesses. So far, we have discussed Google Trends,...
We have listed best practices for great content whether you are into streaming, podcasting, or looking to step up your YouTube videos.

Level Up Your Videos With This Ultimate YouTube Playbook

We recently talked about how Youtube and other major platforms are democratizing content creation in our previous story, Democratization of Content Creation: How You Can...
We went through various business owners and for this post, we have compiled the best takeaways to build generational wealth.

Your Guide to Beat All Odds and Build Generational Wealth

For most people, when they hear financial security, they think about paying their bills on time and having enough savings for any emergencies. However,...
A pandemic-induced surge in pet ownership and rising consumer awareness has led to skyrocketing demand for pet products across India.

Popular Trends: Business Opportunities in Pet-Friendly Rentals, Potato Milk, UTIs, and More

Pet-friendly Rentals A pandemic-induced surge in pet ownership and rising consumer awareness has led to skyrocketing demand for pet products across India and the globe,...
There has been a lot of debate going around how the world is set to experience a hyperinflationary crisis, especially after a warning from Jack Dorsey.

Hyperinflation Has Become the Topic of The Week; Here’s What You Need to Know

It was late evening, we were talking about the upcoming festive season, and suddenly we started getting many notifications. They all had one thing...
The pandemic taught us how a crisis could lead to lasting changes in the market. Here's a go-to guideline that you can seek to survive in a crisis like World War 3.

How to Effectively Run Your Business During A World War 3

These are some unprecedented times. Many are also calling it the most significant catastrophe since World War 2.  There is a pandemic, economic crisis, supply...