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The Reserve Bank of India (RBI) has decided to make the Unified Payment Interface (UPI) payments easier for investments. “It has…been decided to introduce a single-block-and-multiple-debits functionality in UPI, which will significantly enhance the ease of making payments in e-commerce space and towards investments in securities," RBI Governor Shaktikanta Das said after announcing the bi-monthly policy review.

How will the new feature in UPI platform to help customers?

This facility will enable a customer to block funds in his/her account for specific purposes, which can be debited whenever needed. This will significantly enhance the ease of making payments for investments in securities including through the Retail Direct platform as well as e-commerce transactions.

Currently customers can make recurring payments for SIPs via UPI, as well as single-block-and-single-debit transactions. 

Dr. Jasmin Gupta, Co-founder & CEO, of LXME (neo-bank for women) said, "With capabilities in UPI further enhanced by introducing single block and multiple debit functionality, making payments in the e-commerce space and for investments in securities will become easy. The customer will be able to block funds in his/her bank account for specific purposes, such as hotel bookings, the purchase of securities, etc., that will be debited post-service or post-product delivery. The value-added feature will enable trust-building in person-to-person and merchant-to-merchant transactions."

'Single-block-and-multiple debits' feature on UPI

Through the 'single-block-and-multiple debits' feature on UPI platform, customers will have more trust while carrying out such transactions as merchants will be assured of timely payments, while the funds remain in the customer's account till actual delivery of goods or services. 

A customer will create a payment mandate against a merchant by blocking funds in his/her bank account for specific purposes which can be debited, whenever needed.

The feature will also be helpful in purchase of government securities using the RBI's retail direct scheme, RBI Governor Das said.

 

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