The RuPay card launched by National Payments Corporation of India (NPCI) on Monday has the potential to make debit cards safer by incorporating the pin number with each transaction.
At present, only the Maestro of MasterCard requires the user to furnish the pin number every time the card is used.
The RuPay, conceived as India's answer to the Visa and MasterCard, would make it impossible for anyone else to use the card.
"RuPay cards make the payment safer for the bank customers as it is a pin-based card," said AP Hota, managing director and chief executive officer, NPCI. "People who have the pin number will only be able to use the card," he added.
NPCI's RuPay will be accepted at all 91,000 ATMs and over 6 lakh Point of Sale (PoS) terminals in the country. According to the Reserve Bank of India (RBI) data there are close to 27 crore debit cards in India. Public sector lenders Bank of India and Union Bank of India have already started issuing RuPay debit cards to customers and other banks are likely to do the same soon.
"We expect all major banks to be a part of RuPay network in six months' time," added Hota.
Low cost structure of RuPay is a major attraction for banks in India to join the network. Foreign card players such Visa and Mastercard have comparatively high fee structure for banks.
According to the sources, they charge around $30,000-$50,000 as one-time fee and around $10,000-$30,000 quarterly fee from banks.
NPCI does not charge any one time joining fee from banks and other charges are around 40% less than Visa and Mastercard.
"Lower charges from NPCI are a major attraction for the banks to join RuPay network as banks will save significant amount of money," said senior banks official, Bank of India.