PhonePe introduces new feature to link pre-approved credit lines to UPI

PhonePe has launched a new feature that allows users to link their pre-approved credit lines to UPI, making it easier to pay for purchases at millions of merchants.

If you have a pre-approved credit line from your bank, you can now link it to your UPI account on the PhonePe app. This means you can use your credit line to make payments, just like you would with a debit card, but with the flexibility of short-term credit. It's a handy way to manage monthly expenses without needing to dip into your savings immediately.

Why is this useful?
For consumers, it provides an easy way to access and use credit for daily purchases. For businesses, it offers an additional payment option for customers, potentially reducing cart abandonment and increasing sales. This new feature could make payments smoother and more efficient for everyone involved.

The Reserve Bank of India recently expanded UPI's capabilities to include pre-approved credit lines, making this feature possible. PhonePe’s latest update builds on this by allowing users to directly link these credit lines to their UPI for easy payments.

How to get started
To link your credit line on PhonePe:

-Open the PhonePe app and go to the profile section.
-Select the bank from which you have a credit line.
-Link your credit line to UPI by following the prompts and setting up a UPI PIN.
-Once linked, you’ll see the credit line as a payment option during checkout.
-PhonePe's Head of Payments, Deep Agrawal, emphasised that this feature aims to enhance the ease of digital payments and expand the use of credit in India.