IndiaQR, a government-backed QR code payment service, is now available in India as of Monday (Feb. 20).
According to a report, the launch of IndiaQR marks the latest push by the Indian government to move away from a cash-based society in response to taking high-denomination notes out of circulation in November. The report noted the QR codes can be used to store web links and bank account information and can easily be read by the cameras built into smartphones. Merchants without a terminal or POS can now accept card payments by scanning the QR code. IndiaQR is a government-mandated project, according to the report, which noted it was developed by Mastercard, Visa and RuPay.
In addition to trying to move away from cash, the creation of IndiaQR has prompted third parties to create services. For instance, Paytm of India landed a $900 million investment to develop a QR payment service, and the company is gearing up to train millions of merchants on how to accept digital payments by the end of 2017. HDFC, India’s largest bank, has chosen In-Solutions Global to create an end-to-end merchant acquiring platform and apps to help people move to digital payments.
In November, Prime Minister Narendra Modi announced the country’s 500-rupee and 1,000-rupee banknotes were to be taken out of circulation. Taking those notes out of the financial system represented an effort to stymie fraud efforts, corruption and what and illegal cash holding. Modi stated that the illegal activities are among the “biggest obstacles in eradicating poverty” — with a bead being drawn on tax evaders, according to a report in the BBC at the time. In place of the 500- and 1,000-rupee notes, a new set of 500-rupee and 2,000-rupee notes are being issued as replacements.