BharatQR code, the world’s first interoperable payment acceptance solution, was launched on 20 Feb 2017 as part of efforts to move towards less-cash economy at an insignificant cost. It will make payments seamless for buyers as they just have to “scan to pay” for transactions instead of swiping their credit/debit cards. This article explains what is BharatQR code? Why is it needed and how to pay using BharatQR code? How does it help merchants to reduce costs? How is it different from other digital mode of payments like PayTm, Freecharge etc.
What is BharatQR Code
Basics of BharatQR
What is Need for BharatQR?
Over the past few months, the government has been aggressively pushing for higher usage of digital payment mechanisms, including launching BHIM app and increasing penetration of PoS machines. BharatQR code is an important step in going cashless and solves the problem of merchants who can now get payment using credit/debit cards or digital payment without PoS(Point of Sale) machines. It helps the merchant to save the transaction costs. The main reason for this is, it is ideal for small roadside merchants who find it tough to invest in point-of-sale terminals for card payments. For them, BharatQR is an asset-light and cheap payment solution. There is no need to invest in a terminal hardware, the merchant just needs a smartphone and a QR code printed sticker to accept digital payments.
There were 24.5 million credit cards and 661.8 million debit cards being used in the country in March 2016, according to the Reserve Bank of India (RBI). But only 700,000 merchants accept card payments. And there are only 1.4 million card-swiping machines attached to cash registers in the country.
What is QR Code?
QR code or Quick Response code is a two-dimensional machine-readable code made up of black and white squares and are used for storing URLs or other information. These can be read by the camera of a smartphone. It might be used as a sticker on a product which or on a shop window which has account details about the specific merchant. It is similar to barcode for books.
What is BharatQR?
BharatQR is a matrix of bar codes that has been developed by leading payment companies of the country -Visa, Mastercard, National Payments Corporation of India (which run RuPay), and American Express -to develop a complete digital payments infrastructure at retail merchant outlets. The QRCode would be printed on a placard at merchant outlets for customers to scan and pay. Similar to PayTm placards at the merchant outlets.
How to use BharatQR?
Bharat QR code will make digital payments much easier for both the parties.
What does a merchant need to use BharatQR?
Merchant just needs to get BharatQR code for his outlet from his bank where he has a current account. BharatQR code has details of his bank account. Display it on his cash counter. This will help merchants in avoiding investments in PoS machines and the transaction fees charged by the banks for transactions through the PoS systems. This ensures there is interoperability and customers will not have to bother which mobile wallet app to use or which bank’s app to pay with.
How does customer use BharatQR?
To use Bharat QR code provides customers with an easy scan and pay option irrespective of their card type which eliminates the need for PoS machines on a merchant outlet. To use QR code
- a consumer can simply open his or her banking app or BHIM app,
- scan the merchant’s QR code using the camera of his mobile phone.
- enter the payable amount and
- enter the four digit code to authenticate the transaction.
- The amount will be directly transferred to the merchant’s bank account once the transaction is complete.
- Both the merchant and the customer will receive instant notification after the payment is successful.
How to use BharatQR code
How different is BahartQR code from other digital payment methods like Paytm, Freecharge, and MobiKwik
Bharat QR code will certainly remove a lot of discrepancies in using the digital money for the citizens.
The individual payment portals like Paytm, Freecharge, and MobiKwik required money to be transferred into their wallets first and then be used for further payments.
To make payments through these portals, both the parties involved in the transaction must be using the same payment service to make it possible. For example, to pay using PayTm both merchant and Customer must be using Paytm
There is a limit to the amount of payment that can be put in these portals.
From the merchant’s perspective, these apps charge a transactional fee from them.
Bharat QR code eliminates all such roadblocks as it is directly linked to the bank. The payments will go straight to the merchant’s bank account through IMPS. Also, there is no limit to the amount of money the merchant can put in the bank.
What is the status of BharatQR now?
As of 20 Feb 2017, BharatQR has gone live with 14 banks. All the major ones like SBI, ICICI Bank, HDFC Bank, Axis Bank and others will start enrolling its merchants on BharatQR so that they can start accepting payments. Customers with any of these banks will be able to make as well as collect payments via scanning of QR codes. The banks that are ready to use BharatQR code are
- SBI, Axis Bank, Bank of Baroda, Bank of India, Citi Union Bank, Development Credit Bank, Karur Vysya Bank, HDFC Bank, ICICI Bank, IDBI Bank, RBL Bank, Union Bank of India, Vijaya Bank and Yes Bank.
- Many other banks are at various stages of implementation.
In the second phase, NPCI is planning to introduce payment means through IFS code, Aadhaar Pay, and even Unified Payments Interface.
Mobile wallet companies like Paytm have already been working with QR codes for some time
What happens if the customer loses his smartphone?
If in case a user loses his or her smartphone, all they need to do is call their respective bank and inform them of the mishap.
Related articles:
- BHIM App: How to Install, Use
- Go Cashless:Digital Wallets, NEFT,IMPS,UPI, Debit Cards,Credit Cards
- USSD Banking On Mobile without Internet even on a Basic Mobile Phone
- What are Mobile Wallets or Digital Wallets
- Paytm: How to Use Paytm,Open Paytm account,Pay using Paytm
- Pockets Facebook App by ICICI Bank, Social Banking
- What happens when credit card is swiped?
- What is Unified Payment Interface or UPI?
- Third Party Fund Transfer NEFT RTGS
- IMPS or Immediate Payment Service : Send Money Instantly
- What is Mobile Banking
Whether any MDR would be applicable for the merchants/recipients who receive the payment. Say I make a payment of Rs. 100.00 to a vendor. For how much amount my account will be debited and for how much amount the vendor’s account will be credited. And is there is any limit on number of transactions and/or amount of money for payment.