BharatQR Code is World’s First Interoperable Payment Acceptance Solution Doing Away with Swipe Card Terminals

BharatQR code, the world’s first interoperable payment acceptance solution, has been launched by Government of India on February 20, 2017, as part of its efforts to move towards less-cash economy, at an insignificant cost. Bharat QR code, developed jointly by National Payments Corporation of India (NPCI), Visa, MasterCard and American Express under instructions from Reserve Bank of India (RBI), will make payments seamless for buyers as they just have to “scan to pay” for transactions instead of swiping their credit/debit cards.  This is another transformational push by the government towards higher usage of digital payment mechanisms, including launching of BHIM app and increasing penetration of PoS machines. The details are as under:

• BharatQR code works as common interface for the MasterCard/Visa/RuPay platforms and also facilitates acceptance of Aadhaar-enabled payments and Unified Payments Interface (UPI).
• As of now 15 banks including SBI, PNB, BOB, BOI, Union Bank, Vijaya Bank, HDFC, ICICI,IDBI and Yes Bank support BharatQR code and more are expected to join.
• It enables person to make payments to retailers without using the merchant’s ID or number. It eliminates need of using card swiping machines making digital payments.
• Using, BharatQR code merchants will be required to only display one QR code instead of multiple ones. Merchants will be able to generate their own code that will be interoperable with banks, doing away with swipe card terminals
• QR code or Quick Response code is a two-dimensional (matrix) machine-readable bar code made up of black and white squares and is used for storing URLs or other information. These can be read by the camera of a Smartphone. It carries information both horizontally and vertically. It has error correction capability and data stored in it can be restored even if it is partially damaged or dirty.
• Users can make payment by scanning the code. BharatQR code is of two types static and dynamic. In static QR code, first code need to be scanned and then amount is entered to make payment. In case of dynamic QR code, new QR code will be generated in real time for every transaction. In this case there is no need to enter the amount. The payment is just made by scanning and entering the PIN.

This innovative and conceptually simple BharatQR code makes the payment system dependent on technology more than ever before, raising the pressure on cyber security. Banks will have to make foolproof systems and protocols to protect data as the bank accounts get linked to Aadhaar and various payment systems through internet. Banks must invest in acquiring the needed hardware and software, train staff to adhere to strict protocols and educate customers. The government must ensure to strengthen cyber security and have a robust legal framework for privacy and data protection while aggressively pushing for the digital payments.