Cash@Merchant Locations using UPI

India also lacks sufficient number of ATMs for banking customers. According to the International Monetary Fund, India has the fewest ATMs per 100,000 people among BRICS countries, while data from RBI in May 2019 showed that the number of ATMs in the country fell over the past two years. Banks have now started using UPI for card-less cash withdrawals at ATMs.

You can now use UPI to withdraw cash from your accounts at merchant outlets. While the feature allows only small withdrawals at the moment, using UPI to convert money into cash is not unheard of in India. Many e-commerce platforms use UPI as an accepted mode of payment under their cash on delivery feature, while couriers often tell customers to make payments through apps like Google Pay, PhonePe etc. instead of handing over cash for deliveries.

NPCI has recently introduced cash withdrawal facility at merchants using UPI. This service is in line with the existing facility available at Cash @POS enabled by cards .

Broad guidelines and compliance requirements to implement this service are as under :

1. Transaction Limit : Transaction limits shall be Rs.1000 per day in Tier 1 &Tier 2 centres and Rs.2000 per day in Tier 3 to Tier 6 centres.

2. Transaction Frequency : Only 3 transactions will be permitted per account per UPI ID.

3. Fee : Issuer may decide to charge customers up to 1% of transaction value, capped @Rs.10.00.

• Interchange of 0.5% of the transaction value subject to a cap of Rs.5.00 will be applicable for these transactions .
• NPCI & PSP fees shall be applicable as per existing UPI P2P model.

4. Payee PSP & TPAPs/Apps shall be responsible for due diligence and on-boarding of merchants as per regular merchants on-boarding applicable rules.

5.If the facility for cash withdrawal using UPI is available at merchant location, Payee-PSP shall ensure that the facility be available irrespective of whether a customer makes a purchase or not.

6. Marchant establishments designated by the app provider shall clearly and promptly indicate / display the availability of this facility along with charges the customer has to bear.

7. TPAPs/Apps shall make separate enablement for this transaction in their UPI enabled App and populate the MCC code- MCC-6010 allocated by NPCI in the push based transactions.

8. Before taking the transaction confirmation from users, the TPAP/App shall inform the user that this is a 'Cash Withdrawal' transaction and the associated cost that the user will have to bear.

9. This service will commence from 1st June , 2020.