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NPCI & Digital Ecosystem

Banking / Economy Awareness · Payments & Financial Infrastructure

Useful for: IBPS Banking

Overview

NPCI is the umbrella body for retail payments in India and runs most digital payment products.

Key points

NPCI was set up in 2008 as an initiative of the RBI and the Indian Banks’ Association.
Products include UPI, IMPS, RuPay, NACH (bulk/recurring payments), AePS (Aadhaar-enabled payments) and NETC (FASTag).
BBPS (Bharat Bill Payment System) allows bill payments across channels.
AePS lets customers withdraw cash using Aadhaar and biometrics at micro-ATMs.
NACH handles salaries, subsidies, EMIs and SIPs in bulk.

Explanation

FASTag uses RFID for electronic toll payment.
NPCI is a not-for-profit company.
Interoperability means any bank’s customer can pay any other bank’s customer.
NPCI International takes UPI and RuPay abroad.

Step by step

Identify the institution, rule or instrument asked.
Recall its definition, year, limit or function from a table.
Eliminate options from similar institutions or older rules.

Examples

NPCI was set up in → 2008.
Electronic toll collection product of NPCI → NETC FASTag.
Aadhaar-based cash withdrawal at micro-ATMs → AePS.

Traps and advanced points

Trap: Saying RBI directly runs UPI.
Trap: Mixing NACH and NEFT.
Trap: Thinking FASTag uses QR codes.

Quick revision

NPCI 2008 (RBI + IBA).
UPI, IMPS, RuPay, NACH, AePS, NETC, BBPS.
AePS = Aadhaar + biometrics.

Practice MCQs

NPCI was set up in —
1. 2008
2. 2012
3. 2016
4. 2004
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Answer: (a) 2008. 2008.
NPCI is an initiative of the RBI and the —
1. NABARD
2. Indian Banks’ Association
3. SEBI
4. IRDAI
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Answer: (b) Indian Banks’ Association. IBA.
Bulk and recurring payments like salaries are handled by —
1. RTGS
2. NACH
3. AePS
4. BBPS
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Answer: (b) NACH. NACH.
Withdrawing cash using Aadhaar and biometrics at micro-ATMs uses —
1. UPI Lite
2. AePS
3. NACH
4. BBPS
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Answer: (b) AePS. AePS.
Bill payments across channels use —
1. NACH
2. IMPS
3. BBPS
4. AePS
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Answer: (c) BBPS. Bharat Bill Payment System.
Which is an NPCI product?
1. RTGS
2. SWIFT
3. UPI
4. NEFT
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Answer: (c) UPI. NEFT and RTGS are RBI systems.
NETC (FASTag) is used for —
1. electronic toll collection
2. cheque clearing
3. loan approval
4. tax filing
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Answer: (a) electronic toll collection. Toll payments.
RuPay is a product of —
1. SBI
2. Visa
3. NPCI
4. RBI
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Answer: (c) NPCI. NPCI.
AePS stands for —
1. Automated e-Payment Service
2. All-electronic Pay Scheme
3. Account Enabled Payment System
4. Aadhaar-enabled Payment System
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Answer: (d) Aadhaar-enabled Payment System. AePS.
SIPs and EMIs are usually collected through —
1. cheques only
2. NACH
3. RTGS
4. AePS
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Answer: (b) NACH. Recurring mandates.