Paytm, PhonePe, Google Pay, others can’t use exclusive QR codes; RBI rules for interoperable payments

Paytm, PhonePe, Google Pay, Amazon Pay, and other Payment System Operators (PSO) will now not be allowed to use exclusive QR codes that work only on their own platforms. Instead, the Reserve Bank of India has asked the payment apps to shift to one or more interoperable QR codes by March 31, 2022. RBI instructed that no new proprietary QR codes shall be launched by any PSO for any payment transaction. With the latest move, customers can pay on any platform from any app that supports UPI payments. RBI’s decision is in an effort to reinforce the acceptance infrastructure, provide better user convenience due to interoperability, and enhance system efficiency in the country.

Though many PSOs had already implemented the interoperable QR codes, there were a few that were still using proprietary QR codes for the transactions. The central bank further said that the two interoperable QR codes in existence — UPI QR and Bharat QR — shall continue as at present, and PSOs may take initiative to increase awareness about interoperable QR codes. It also added that a consultative process to standardise and improve interoperable QR codes will continue to enable beneficial features identified by the Phatak Committee.

The Reserve Bank had earlier constituted a committee to review the current system of QR codes in India and suggest measures for moving towards interoperable QR Codes. UPI payments in India have been growing at a substantial pace in the last two years, giving a strong boost to Prime Minister Narendra Modi’s ‘Digital India’ mission. The volume of UPI transactions shot up by nearly 13 times while the value of transactions skyrocketed by around 20 times during FY18 and FY20, according to the Reserve Bank of India. In August 2020, Amitabh Kant, CEO, Niti Aayog had said in a tweet that UPI with 18 billion transactions annually has surpassed Amex at 8 billion.