The service will enable select customers of ICICI Bank to avail a credit line (for making UPI payments) of up to INR 2 Lakh with a repayment period of 45 days
The collaboration will enable the two companies to expand their offerings, tap into new customers, create additional streams of revenue, and enable high-value purchases
This comes a year after the RBI expanded the scope of UPI to include pre-approved credit lines
Digital payments major PhonePe
has announced a partnership with ICICI Bank to roll out credit-on-UPI for customers of the bank.
In a statement, ICICI Bank said that the service will only be available for pre-approved customers on the PhonePe app. The new service will enable select customers to avail a credit line (for making UPI payments) of up to INR 2 Lakh with a repayment period of 45 days.
“This credit line is interoperable across various UPI payment applications and provides customers the facility of transacting using any UPI payment app,” added the bank.
Commenting on the partnership, head of payments at PhonePe Deep Agrawal said, “… This partnership will enable customers to avail flexible short-term credit through a fully digital user experience from within the PhonePe app instantly. Credit line on UPI is yet another innovative product offering that will unlock and revolutionise access and use of credit in the country…”.
Chiming in, ICICI Bank’s head of payment solutions Niraj Tralshawala added, “…At the anvil of the festive season, the pre-approved customers of ICICI Bank can activate the credit line instantly to make payments for their festive shopping needs on PhonePe”.
The collaboration will enable the two companies to expand their offerings, tap into new customers, create additional streams of revenue with interest payments, and enable high-value purchases.
This follows PhonePe introducing credit line on UPI in August this year, which allows users to link their bank’s credit lines directly to UPI on the platform. This comes a year after the Reserve Bank of India (RBI) expanded the scope of UPI to include pre-approved credit lines.
It is pertinent to note that the credit line on UPI utilises the existing UPI infrastructure for a seamless experience.
The development comes as UPI transactions recorded a modest month-on-month (MoM) increase of 0.53% in September 2024, rising to 1,504 Cr from 1,496 Cr in the previous month. On a year-on-year basis, the transaction count saw a significant surge of 42%.
According to data from the National Payments Corporation of India, the total UPI transactions processed in September amounted to INR 20.64 Lakh Cr, up from INR 20.61 Lakh Cr in August.
