The promise and pitfalls of credit cards on UPI

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Editor's note: The evolution of the Unified Payments Interface has entered its next chapter with the Reserve Bank of India permitting banks to link credit cards to the payments platform.  Yesterday, the RBI announced that RuPay credit cards would be the first that can be linked. Customers will be able to link credit cards to their UPI addresses, just as they do today with bank accounts. Whereas everyday merchants will be able to accept credit card payments either on their mobile apps or through QR codes without the need of a card terminal. The move—once the process is fleshed out and card issuers and payment apps get on board—will lead to a boost in UPI transaction volumes in its immediacy. UPI apps such as PhonePe, Google Pay and Paytm would be able to act as virtual credit cards for customers. A host of other fintech companies that have UPI payments would also have the option of integrating credit cards, though the specifics of it might vary.  The general sense is that it is only a matter of time before the same option …