From UPI To EMI! How NPCI Aims To Convert QR Code Payments Into EMIs; What It Means For You?

From grocery bills to buying a favourite T-shirt at the mall, most of us rely on QR-based UPI payments for everyday transactions. But when it comes to high-value purchases converted into EMIs, QR-code payments are still a distant reality. To bridge this gap, the National Payments Corporation of India (NPCI) is reportedly working to bring a new feature.

NPCI's new feature will willow people to convert their Unified Payments Interface (UPI) transactions into Equated Monthly Instalments (EMIs), reported Economic Times citing sources. The new UPI's EMI feature will not only expand the access of UPI-based payments, but will also make credit lending easier.

NPCI To Enable QR-Payments EMI Conversion

As per ET report, NPCI has collaborated with fintech companies to bring the EMI feature for online QR-based transactions. The initiative will help NPCI to integrate an EMI payment feature. This will help tem to convert their UPI transactions into EMIs within a second. The feature will help people to use credit cards for making payments using QR code.

All About UPI QR-Code Transactions, EMI Conversion

This new feature would mirror card payments at point-of-sale terminals, where customers can convert a card swipe into EMI directly at the terminal. After RuPay credit cards became mainstream on UPI, and with credit lines opening up, NPCI is considering this addition. Some banks have already partnered with fintechs like Navi and Paytm to offer credit lines to UPI users.

As per ET report, Navi is already planning to launch the feature for its customers. Fintech founders see potential in generating revenue from credit payments on UPI. Unlike savings account-based payments where no merchant fee is charged due to government mandates, there is a possibility of earning from credit transactions. A Gurugram-based fintech startup founder mentioned that NPCI plans to impose a 1.5% interchange fee on credit lines via UPI. As of now, there has been no confirmation about when the new feature will be available for customers use.

UPI processes approximately 20 billion transactions monthly with 250-300 million active users. To expand further and incorporate diverse payment types, industry insiders believe focusing on credit is essential-a direction NPCI is keenly pursuing. With clarifications around aspects like interest-free periods and credit bureau filings for such loans, more banks are expected to join the UPI credit initiative.

The UPI payments has become a household method for making transactions and payments without using Indian notes and coins. According to reports, the India fintech and UPI payments market was valued at an estimated $2.5 trillion in 2024. The market is expected to reach US 12.52 trillion by 2032. Digital India push has significantly increased the UPI payment across the country. Fintech and UPI payments have significantly changed the digital transactions arena in the country by enabling fast secure and low-cost real-time money transfers.