Unified Payments Interface (UPI) is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing & merchant payments into one hood.
It also caters to the “Peer to Peer” collect request which can be scheduled and paid as per requirement and convenience.
NPCI conducted a pilot launch with 21 member banks. The pilot launch was on 11th April 2016 by Dr. Raghuram G Rajan, Governor, RBI at Mumbai. Banks have started to upload their UPI enabled Apps on Google Play store from 25th August, 2016 onwards.
- Immediate money transfer through mobile device round the clock 24*7 and 365 days.
- Single mobile application for accessing different bank accounts
- Single Click 2 Factor Authentication – Aligned with the Regulatory guidelines, yet provides for a very strong feature of seamless single click payment.
- Virtual address of the customer for Pull & Push provides for incremental security with the customer not required to enter the details such as Card no, Account number; IFSC etc.
- Bill Sharing with friends.
- Best answer to Cash on Delivery hassle, running to an ATM or rendering exact amount.
- Merchant Payment with Single Application or In-App Payments.
- Scheduling PUSH and PULL Payments for various purposes.
- Utility Bill Payments, Over the Counter Payments, Barcode (Scan and Pay) based payments.
- Donations, Collections, Disbursements Scalable.
- Raising Complaint from Mobile App directly.
UPI - Benefits to the Ecosystem participants
Benefits for banks:
- Single click Two Factor authentication
- Universal Application for transaction
- Leveraging existing infrastructure
- Safer, Secured and Innovative
- Payment basis Single/ Unique Identifier
- Enable seamless merchant transactions
Benefits for end Customers:
- Round the clock availability
- Single Application for accessing different bank accounts
- Use of Virtual ID is more secure, no credential sharing
- Single click authentication
- Raise Complaint from Mobile App directly
Benefits for Merchants:
- Seamless fund collection from customers - single identifiers
- No risk of storing customer’s virtual address like in Cards
- Tap customers not having credit/debit cards
- Suitable for e-Com & m-Com transaction
- Resolves the COD collection problem
- Single click 2FA facility to the customer - seamless Pull
- In-App Payments (IAP)
Performing a UPI Transaction:
- PUSH – sending money using virtual address
- PULL – Requesting money:
- UPI provides for real time reversals for technical declines and amount would be transferred back to the payer account immediately
- The upper limit per UPI transaction is Rs. 1 Lakh.
- Once the payment is initiated, it cannot be stopped.
- Registration of Beneficiary is not required for transferring funds through UPI as the fund would be transferred on the basis of Virtual ID/ Account+IFSC / Mobile No+MMID / Aadhar Number.
- Customer cannot link a wallet to UPI, only bank accounts can be added.
- One can use more than one UPI application on the same mobile and link both same as well as different accounts.
The different channels for transferring funds using UPI are:
- Transfer through Virtual ID
- Account Number + IFSC
- Mobile Number + MMID
- Aadhar Number
- Collect / Pull money basis Virtual ID
UPI is providing additional benefits to IMPS in the following ways:
- Provides for a P2P Pull functionality
- Simplifies Merchant Payments
- Single APP for money transfer
- Single click two factor authentication.