UPI, The Unified Payment Interface, is a very new money transaction term or method in the banking sector. A service that inter-operable in-between banks, and a big thanks to National Payments Corporation of India for building such a very incredible one. Now the UPI is live with 21 major banks in India and very sad thing is State Bank is not in the list now. But surely come on this list soon. Currently there are many payment or transaction services available like IMPS, NEFT, RTGS etc.. The UPI is a new born with extraordinary capabilities. Lets discuss about more and more about UPI. I call it is an Ultimate Product of India.

What is UPI?

It is a true payment system that can be used at any time any where without any hassle. The UPI has the ability to transfer money between family, friends, or pay at shop or buy something from online or pay the rent of your home etc. instantly via safe and secure platform. In background the UPI is based on the IMPS system.

Difference in UPI?

UPI is a funds transfer technology which can be done via bank’s app on smartphone. Although such type of transfer already exists; the biggest differentiating factor is that the sender does not need receiver’s bank account details for sending the money. Only thing required is the virtual payment address.

Sl.FeatureUPINEFT/IMPS/RTGSWallets
1Through which device transfer can be doneOnly smartphoneWebsite and appWebsite and app
2Transfer speedInstantTime consuming. But is instant & real time in case of RTGS.Instant
3Can you send money abroadNoYesYes
4Can you transfer money 24*7YesOnly RTGSYes
5How complex are the transfer detailsVery easy, requiring just virtual payment addressIFSC code is bank & branch specific and difficult to rememberVery easy
6Can recurring billing be setup?NoYesYes
7Time taken for new payee registrationNo need to add payeeTakes minimum 30 minutesLess time consuming
8Are bank account details must for the transferNoYesYes
9Can you reject money received incorrectlyYesNo such option available unless someone reported to the bankNo such option available
10From where is the money credited/debitedFrom bank accountFrom bank accountFrom wallet
11Is there any transfer chargeYes. Rs. 0.50 per transactionAt least Rs. 2.50 & Rs. 5 for NEFT & IMPS respectivelyNo
12Is smartphone must for transferYesNoNo
13Any money collection alert sentYesNoNo
14Any payment approval alert receivedYesNoNo
15Any interest received on the money keptYesYesNo
16Payee registration timeInstantTakes timeInstant
17Can you use app of non-bank account for transactionYesNANA
18Any transfer limitYes. Rs. 1, 00,000Rs. 10, 00,000No
19How many authentication details requiredUPI app login & 4-6 digit M-PIN neededInternet/mobile banking logins and OTP/transaction password/debit card gridInternet/mobile banking logins and OTP/transaction password/debit card grid
20Is OTP required for transferNoYesYes
21How easy is the beneficiary additionVery easy, requiring just virtual payment addressAddition of bank account details and bank approval is needed before transferVery easy
22Are beneficiary details neededOnly virtual ID is requiredPre-addition of details is neededNo
23Does beneficiary addition require bank’s approvalNoYesNo
24Is beneficiary addition mandatoryNoYesNo
25Any payment gateway involved during transferNoYesYes
26How many banks offer this payment method21Almost every bank in India offers this payment methodNA
27Can you pay anyone with this payment methodNo. As of now only an individual or merchant.Anyone i.e. individual, merchants, various service providersAnyone i.e. individual, merchants, various service providers
28Can you do eCommerce transactionsNoYesYes

How to get start?

Steps for Registration:

  1. Dodownload UPI application from the App Store / Banks website
  2. Create profile by entering details like name, virtual id (payment address), password etc.
  3. Go to “Add/Link/Manage Bank Account” option and links the bank and account number with the virtual id

Generate MPIN:

Select bank account from which you want to initiate the transaction User clicks one of the options:

  1. Mobile Banking Registration/Generate MPIN
  2. Change M-PIN

For Registering or Generation MPIN:

  1. You will receive One Time Password (OTP) from the issuer bank on his/her registered mobile number
  2. You have to enter last 6 digits of debit card number and expiry date
  3. Enter OTP and preferred numeric MPIN (MPIN to be set) and clicks on ‘submit’
  4. After clicking submit, customer gets notification (successful or decline) for changing M-PIN
  5. Enters old MPIN and preferred new MPIN (MPIN to be set) and click on ‘Submit’
  6. After clicking submit, customer gets notification (successful or failure)

How a UPI transaction is performed:

PUSH – Sending money using virtual address:

  • Log on to UPI application
  • After successful login, select the option of Send Money/Payment
  • Enter beneficiary’s/Payee virtual id and amount and select account to be debited
  • You will get confirmation screen to review the payment details and clicks on ‘Confirm’
  • Enter MPIN
  • Get ‘successful’ or ‘failure’ message

PULL – Requesting money:

  • Log in to the bank’s UPI application.
  • After successful login, select the option of collect money (request for payment)
  • Enter remitters/payer’s virtual id, amount and account to be credited
  • You will get confirmation screen to review the payment details and clicks on confirm
  • The payer will get the notification on his mobile for request money
  • Payer now clicks on the notification and opens his banks UPI app where he reviews payment request
  • Payer then decides to click on accept or decline
  • In case of accept payment, payer will enter MPIN to authorise the transaction
  • Transaction complete, payer gets ‘successful’ or ‘decline’ transaction notification
  • Payee/requester gets notification and SMS from bank for credit of his bank account

Also published on Medium.