UPI: You transact money through Google Pay, Phone Pay, or Amazon Pay. You also make payment for any goods or services. But this is possible only when these digital payment wallets are linked to a bank account. But now the situation will change. Now you will be able to transact or pay money even from such digital payment wallets which are not linked to any bank account. Reserve Bank has now approved payment or transfer of money through such third party apps as well. These third party apps will be prepaid instruments. That is, a digital wallet in which money has to be deposited first through a bank account, UPI, or cash. Then you will be able to pay the same amount. Without depositing money separately, these wallets will not be able to use your bank account for money transfers. Reserve Bank has given a green signal to UPI transactions through PPI. For this, PPI holders will have to compulsorily do KYC. After this green signal from the Reserve Bank, bank or non-bank will be able to issue their PPI wallet.

Understand it easily from these examples

You use gift cards, metro rail card etc. All these are PPI wallets. The money that is deposited in them through cash or transfer from bank account can only be used for payment. But after the new order of Reserve Bank or after getting their KYC done, money can also be transferred through them on Google Pay, Phone Pay etc. apps.

Step taken to make digital payment easy

The purpose of this green signal from Reserve Bank is to make the process of digital payment easy. With this, payment of money from UPI can be accepted on PPI wallet and money can also be sent on UPI platform.

Disclaimer: This content has been sourced and edited from abplive.com. While we have made modifications for clarity and presentation.