UPI will rival credit cards! Stunning feature could be coming that will delight users.

UPI is poised to take another major step forward in the digital payments world. Now, efforts are underway to make small loans through UPI easy and flexible….

UPI Loan Without Interest: UPI is preparing to take another major step in the digital payments world. Now, work is underway to make small loans through UPI easy and flexible. If the ongoing discussions between banks and the National Payments Corporation of India (NPCI) are successful, loans obtained through UPI will also be interest-free for a limited period.

As with credit cards, this change may bring relief to ordinary users, but it is bound to increase the concerns of credit card companies.

UPI Credit Line

UPI credit lines haven’t gained much popularity among the public. One major reason for this was its interest-bearing system. Whenever a user made a payment using this facility, interest was expected to accrue on the amount from the same day.

For example, if someone had no money in their account and needed it urgently, they would receive the funds, but the pressure of interest would immediately begin. This fear prevents most people from using UPI credit lines.

What is the new plan?

NPCI’s new plan is to provide a grace period for UPI credit lines, similar to a credit card. During this period, customers will not be charged any interest, similar to the feature available with credit cards.

This means that you can spend from your credit line if needed and pay it off before the bill due date. No extra charges will be levied for doing so.

Some banks have launched new initiatives

This change has already begun with select banks. Yes Bank has started offering interest-free payments for up to 45 days on its UPI credit line. Suryoday Small Finance Bank is also offering its customers a 30-day interest-free period.

These initial steps indicate that the banking sector is seriously considering this new model and it may gain further momentum in the future.

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