What is E-Rupee? Is It Better Than UPI?

India’s very own E- Rupee is a noncontact electronic payment that is fully cashless that was launched by the Reserve Bank of India (RBI), on December 1, 2022.

The E-Rupee holds the same value as the physical money which means that Rs 1 in cash is equal to 1 digital rupee. The Digital rupee is issued by RBI and the distribution of Central Bank Digital Currency (CBDC) is managed by the banks. The E- Rupee can be exchanged one to one with the money issued by the government.

The E-Rupee will be provided to the beneficiaries either as an SMS-based e-voucher or as a QR code. Mobile devices with non-android versions or iOS can also have this type of E-Rupee.

Is E-Rupee better than UPI?

E-Rupee VS UPI , lets know which one is better

• As discussed above, E- Rupee is a paper currency in an electronic form. Users can purchase or spend money in any commercial zone by scanning the QR codes.  This is one of the risk-free transactions launched by the Central Bank of India.
• The E-Rupee is issued by the RBI in the exact denominations, followed by coins or paper currency. The digital token of the available money will be distributed by the banks.
•  Unlike UPI, E- Rupee can be withdrawn from any bank account but UPI is merely an interface where the transactions happen.
• Digital money such as E- Rupee can be used to make a transaction, and you can even send it to your friends or family as your physical money. But both the person sending and receiving the money must have a digital wallet to make the transfer.
• UPI can be laid upon any store of value. The E-Rupee is a supply of value that can be transferred digitally with the finality of settlement. This transaction can be done immediately.
• The digital wallet can be downloaded as a mobile app. The primary difference between the digital rupee and UPI is that the digital rupee is a cache of value like currency and UPI is precisely an infrastructure on top of any bank accounts that have typical currency.
• When UPI is used, the bank account is debited, and money is sent to the recipient bank, but with paper money, any amount can be withdrawn from the bank, kept in the wallet, or spent that the banks wouldn’t have known.
•  E-Rupee authorizes you to withdraw the digital currency and keep it in the mobile wallet, when you transfer to another person, the money shifts from your digital wallet in the mode of electronic token to theirs hence there is no bank routing or intermediation as UPI.

Conclusion

The E-Rupee is a digital payment solution, that is a sensible hard work put up by the government. E-Rupee can create enormous optimistic opportunities for the population in a hassle free way. Still there is a huge population in India that does not possess access to banking services. But with the E- Rupee most of the population of India will start receiving the government’s financial benefits in the fields of medicine, health, child welfare, subsidiaries. Hence E- Rupee is a boon to all of us.