UPI has become the default payment method for millions of Indians, from street vendors to large retailers. Almost every transaction is now carried out through UPI. So much so that going wallet-free has become a reality. QR codes facilitate swift payments at POS terminals and UPI IDs for simple online transactions. Many banks fulfil this vision with RuPay Credit Cards. Learn everything about these UPI-powered options in this blog.
Benefits of a UPI-linked credit card
The UPI-linked RuPay Credit Cards make transacting feel quicker and hassle-free. Some of the many advantages include:
- Secured transactions
You are required to authorise every payment made through UPI. The system links your bank account with a one-time setup and encrypts your financial information for online security.
- Rewards for every spend
UPI-linked credit cards earn reward points on eligible transactions, adding value to your everyday payments. This, coupled with credit card rewards, adds to your savings on regular transactions.
- Widespread acceptance
UPI is widely accepted across retail and online merchants, making it one of the most versatile payment methods in India. Whether it is through scanning a QR code or paying through your UPI ID, you can select the option anywhere.
- Two-step payments
When you make a UPI payment, you are prompted with complete details about the amount and the recipient. This, coupled with a secure PIN, reduces the chances of unauthorised transactions.
- Simple registration
Right from obtaining the UPI-enabled RuPay Credit Card from IDFC FIRST Bank to linking it to a UPI app, the process is smooth and quick. Make sure to check the eligibility to breeze through the online credit card application.
How do UPI-linked credit cards work
Using a UPI-linked credit card is similar to transacting with funds in your bank account. The mechanism follows the same framework, including these steps:
- Link your credit card to the UPI app
Add your UPI-enabled credit card to your preferred UPI app by selecting the option ‘Add Credit Card’ under the ‘Cards’ section. Add the last 6 digits and the expiry of the credit card.
- Set a UPI PIN
Set your 4 or 6-digit UPI PIN to securely approve every transaction. Choose a PIN that is not easily guessable and avoid sharing it with anyone.
- Make Payments
Start transacting based on your credit limit. Pay for regular expenses like utility bills, groceries, and subscriptions. For payments at merchant stores, pay through QR codes.
Key things to note about the UPI-linked feature
To truly enjoy the seamless experience of a UPI-linked credit card, pay attention to these crucial aspects before you initiate the credit card apply online process.
- Merchant payments only
UPI-linked credit cards work for merchant payments, not person-to-person transfers. For example, with a RuPay credit card from IDFC FIRST Bank linked to your UPI app, you can pay at merchant outlets across India by scanning their QR code through the app. However, you cannot use it to send money directly to another UPI user.
- Importance of secure networks
The credit card linked to UPI is typically digital. When you apply for the credit card online and make payments, it’s best to avoid public Wi-Fi to protect against data breaches. Safe habits go a long way in digital security.
- Credit limit applies
Your UPI spending is linked to your credit limit. So, it helps to separate your UPI spends with a credit card as opposed to how you make them against your bank account balance.
- Charges still apply
Much like regular card usage, standard charges apply based on usage, including interest on outstanding balances, late payment fees, and cash advance fees, based on the UPI-linked credit card usage.
- Transaction limits
The standard daily limits on the maximum amount and number of transactions applicable to UPI apps apply when you make payments through the UPI-linked credit card. Also, the daily limit is affected by your total credit card limit.
Final words
UPI-linked credit cards combine the instant payment system with flexible credit. You can continue paying for your everyday transactions with familiar convenience, while earning reward points against such payments. Every UPI transaction qualifies for varying reward points based on the transaction amount and the spending category. Track your payments to develop smarter spending strategies. You need not spend more than usual. Simply upgrade the way you spend to align with the rewards.