Q. With reference to digital payments, consider the following statements:

  1. BHIM app allows the user to transfer money to anyone with a UPI-enabled bank account.
  2. While a chip-pin debit card has four factors of authentication, BHIM app has only two factors of authentication.

Which of the statements given above is/are correct?

  • 1 only
  • 2 only
  • Both 1 and 2
  • Neither 1 nor 2

Answer: (a) 1 only

Notes:
  • Bharat Interface for Money (BHIM) is a UPI enabled initiative to make easy and quick payment transactions.
  • It is an Indian mobile payment App developed by the National Payments Corporation of India (NPCI).
  • Pioneered and developed by National Payments Corporation of India (NPCI), BHIM has been conceived and launched by the Hon’ble Prime Minister of India, Narendra Modi on 30th December 2016 to bring in Financial Inclusion to the nation and a digitally empowered society.
  • Chip pin debit card does not have four factor authorization while BHIM app has three factor authentication.
RuPay Card Scheme
  • RuPay is the first-of-its-kind domestic Debit and Credit Card payment network of India.
  • The name, derived from the words ‘Rupee and ‘Payment’, emphasises that it is India’s very own initiative for Debit and Credit Card payments.
  • The card can also be used for transactions in Singapore, Bhutan, UAE, Bahrain and Saudi Arabia.
National Payments Corporation of India (NPCI)
  • NPCI, an umbrella organisation for operating retail payments and settlement systems in India, is an initiative of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007.
  • It is a “Not for Profit” Company under the provisions of Section 25 of Companies Act 1956 (now Section 8 of Companies Act 2013), with an intention to provide infrastructure to the entire Banking system in India for physical as well as electronic payment and settlement systems.
  • The Company is focused on bringing innovations in the retail payment systems through the use of technology for achieving greater efficiency in operations and widening the reach of payment systems.