UPI Pay-Later: UPI Now PayLater UPI Now Pay Later is a kind of overdraft facility. You will be able to use it through all UPI apps like BHIM, Paytm, PhonePay, and Google Pay. The facility of PayLater on UPI can be availed only in transactions with merchants. If you cannot send money to any other person for this.
What is UPI Pay Later?
UPI Pay Later is a new feature that allows UPI users to make payments using a pre-sanctioned credit line, even if they do not have enough money in their bank account. This is similar to how a credit card works, but UPI Pay Later is more convenient and accessible, as it does not require a physical card or a high credit score.
How to use UPI Pay Later
To use UPI Pay Later, you first need to be eligible for a credit line from your bank. If you are eligible, you can activate UPI Pay Later in your UPI app. Once activated, you will be able to use your credit line to make UPI payments at any merchant that accepts UPI.
To make a UPI Pay-Later payment, simply select the UPI Pay Later option in your UPI app and enter the amount you want to pay. You will then be prompted to enter your UPI PIN. Once you have entered your PIN, the payment will be processed.
How does UPI Pay-Later work?
When you make a UPI Pay-Later payment, the money is withdrawn from your pre-sanctioned credit line. You will then need to repay the amount you have borrowed, plus interest, to your bank by the due date.
The interest rate on UPI Pay-Later payments varies from bank to bank. Some banks offer a credit-free period, which means that you will not be charged interest if you repay the amount you have borrowed within a certain period of time.
How to activate UPI Pay Later
To activate UPI Pay-Later, you will need to contact your bank and inquire about their eligibility criteria and activation process. Once you have been approved for a credit line, you can activate UPI Pay Later in your UPI app.
Government order on UPI Pay-Later
In September 2023, the Reserve Bank of India (RBI) issued a notification allowing banks to offer credit line facilities to UPI users. The RBI has also set some guidelines for UPI Pay Later, such as:
- Banks must have a clear and transparent policy for UPI Pay-Later, including the interest rates and repayment terms.
- Banks must assess the creditworthiness of customers before approving them for a UPI Pay Later credit line.
- Banks must send regular reminders to customers about their UPI Pay Later balance and due date.
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Benefits of using UPI Pay-Later
There are several benefits to using UPI Pay-Later, including:
- Convenience: UPI Pay Later is a very convenient way to make payments, as it does not require you to carry a physical card or enter your card details.
- Accessibility: UPI Pay Later is more accessible than traditional credit cards, as it does not require a high credit score.
- Flexibility: UPI Pay-Later offers a flexible repayment option, as you can repay the amount you have borrowed in installments.
Drawbacks of using UPI Pay Later
There are also a few drawbacks to using UPI Pay-Later, including:
- Interest rates: UPI Pay Later can be expensive, as the interest rates on credit lines are typically higher than the interest rates on bank savings accounts.
- Overspending: It is easy to overspend when using UPI Pay-Later, as you do not have to see the money you are spending.
How to use UPI Pay Later responsibly
If you are considering using UPI Pay Later, here are a few tips to help you use it responsibly:
- Only use UPI Pay-Later for essential purchases.
- Make a budget and stick to it.
- Set reminders for yourself to repay your UPI Pay Later balance on time.
- If you are unable to repay your UPI Pay Later balance on time, contact your bank immediately.
UPI Pay-Later is a convenient and accessible way to make payments, but it is important to use it responsibly. Be sure to understand the interest rates and repayment terms before you start using UPI Pay Later, and make sure to only use it for essential purchases.