Unified Payment Interface (UPI)
UPI turns into the Indian FinTech Revolution
- In October 2022, UPI processed 7.3 billion transactions valuing about Rs 12.11 trillionrecord high since its inception.
- In terms of both volume and value, UPI has witnessed a consistent upward trajectory since its inception in 2016. UPI crossed 1 billion transactions in October 2019, more than 2 billion transactions in October 2020, and also successfully crossed the threshold of 3 billion within the next one month. Demonetization and Pandemic has aided the rapid adoption of UPI, and while UPI started with only 21 banks in 2016, it now has as many as 365 banks onboard
What is Unified Payment Interface (UPI) ?
- Unified Payments Interface (UPI) is a system that allows electronic money transfers between two bank accounts through a smartphone.
- It was launched by the National Payments Corporation of India (NPCI) in 2016 and is now used by a majority of banks in India.
- UPI enables users to send and receive money instantly and securely, without the need to enter bank account details or net banking login credentials.
- It uses a virtual payment address (VPA) as a unique identifier for each bank account, which can be linked to a user’s smartphone through a UPI-enabled app.
- UPI also offers other features such as bill payments, bank account balance inquiries, and merchant payments. It is available 24/7 and can be accessed from anywhere with an internet connection.
- Overall, UPI has revolutionized the way people make digital payments in India and has greatly increased the convenience and accessibility of financial services for individuals and businesses.
How Unified Payment Interface (UPI) works ?
It is designed to be simple and convenient for users, making it an popular choice for digital payments in India. Here are the key points of how UPI works:
- A user links their bank account to a UPI-enabled app, such as Google Pay or BHIM.
- To make a payment, the user enters the recipient’s UPI ID or scans a QR code.
- The user then enters the amount they wish to pay and confirms the transaction.
- The payment is processed in real-time, with the funds being transferred directly between the two bank accounts.
- The recipient receives a notification of the payment and the funds are credited to their account immediately.
Overall, UPI makes it easy for users to make and receive digital payments, without the need for cash or physical cards.