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With constant advancements in technology and banking, the payments and transfers with UPI have become the fastest, cheapest and the most convenient option. Find out how

People who have always been scared of making payments online can breathe a sigh of relief now. UPI, with its pilot launch on 11th April’2016 with 21 banks by Dr. Raghuram G Rajan, Governor of RBI, has today become the best and the safest payment mode. Let us dive deep into UPI and learn about its unique features.

Related: How digital payment methods are changing the face of the Indian economy 

What is UPI?

 

UPI or Unified Payments Interface is an immediate real-time payment system that helps in instantly transferring the funds between the two bank accounts through a mobile platform.Hence, UPI is a concept that allows multiple bank accounts to get into a single mobile application. This idea was developed by the National Payments Corporation of India and is controlled by the RBI and IBA (Indian Bank Association).

Related: How Unified Payment Interface (UPI) can change the way you bank 

Key Features of UPI

Some of the features of UPI are listed below:

  • Instant transfer of fund through Immediate Payment Service (IMPS) which is faster than NEFT.
  • Since it is completely digital, one can use UPI 24 hours and on all public holidays.
  • Single mobile application for accessing various bank accounts.
  • Uses Virtual Payment Address which is a unique ID as given by the bank
  • Uses Account Number with IFS Code and Mobile Number with MMID or Mobile Money Identifier.
  • MPIN or Mobile Banking Personal Identification number is required to confirm each payment.
  • Also available on USSD service where users can use the service just by dialing *99# and choose the services like fund transfer, send money, request money, non-financial services, balance Enquiry, change MPIN etc. (Service charge of ?0.50 is applicable)
  • Every bank provides its own UPI for different platforms of Android, Windows, and IOS. The banks may or may not charge for the UPI service.
  • Bill Sharing facility.
  • Best for doing merchant payment, utility bill payments, in-app payments, OTC payments, Barcode based payments.
  • One can file a complaint from Mobile App directly.

What makes UPI a secure platform?

This interface is based on the 2 Factor Authentication with a seamless single click payment. This feature of UPI is aligned with the regulatory guidelines that make it the safest. 2 Factor Authentication is quite similar to OTP. Here, MPIN will be used instead of OTP.

Nandan Nilekani, NPCI advisor, assures that the security is fool-proof with UPI as the transaction will happen in a highly encrypted format. NPCI’s IMPS network already manages more than Rs.8k Cr. transactions per day, which will now increase with the use of more mobile phones.

Related: What makes mobile banking safe? 

Related: 10 Things you must know about the BHIM App

How does it work?

For accessing the UPI service, the users need to create a Virtual Payment Address or VPA of their choice. They need to link the VPA to their bank account. This VPA becomes the users' financial address and they need not remember the details like beneficiary account number, IFSC codes, or net banking user id and password for sending or receiving money. This virtual address of the customer for Pull & Push helps in creating an additional security. The customer need not punch in these details over again and there is no credential sharing.


You can learn more about UPI and how to transact using UPI apps from this video

 

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