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. Feature UPI NEFT/IMPS/RTGS Wallets
1 Through which device transfer can be done Only smartphone Website and app Website and app
2 Transfer speed Instant Time consuming. But is instant & real time in case of RTGS. Instant
3 Can you send money abroad No Yes Yes
4 Can you transfer money 24*7 Yes Only RTGS Yes
5 How complex are the transfer details Very easy, requiring just virtual payment address IFSC code is bank & branch specific and difficult to remember Very easy
6 Can recurring billing be setup? No Yes Yes
7 Time taken for new payee registration No need to add payee Takes minimum 30 minutes Less time consuming
8 Are bank account details must for the transfer No Yes Yes
9 Can you reject money received incorrectly Yes No such option available unless someone reported to the bank No such option available
10 From where is the money credited/debited From bank account From bank account From wallet
11 Is there any transfer charge Yes. Rs. 0.50 per transaction At least Rs. 2.50 & Rs. 5 for NEFT & IMPS respectively No
12 Is smartphone must for transfer Yes No No
13 Any money collection alert sent Yes No No
14 Any payment approval alert received Yes No No
15 Any interest received on the money kept Yes Yes No
16 Payee registration time Instant Takes time Instant
17 Can you use app of non-bank account for transaction Yes NA NA
18 Any transfer limit Yes. Rs. 1, 00,000 Rs. 10, 00,000 No
19 How many authentication details required UPI app login & 4-6 digit M-PIN needed Internet/mobile banking logins and OTP/transaction password/debit card grid Internet/mobile banking logins and OTP/transaction password/debit card grid
20 Is OTP required for transfer No Yes Yes
21 How easy is the beneficiary addition Very easy, requiring just virtual payment address Addition of bank account details and bank approval is needed before transfer Very easy
22 Are beneficiary details needed Only virtual ID is required Pre-addition of details is needed No
23 Does beneficiary addition require bank’s approval No Yes No
24 Is beneficiary addition mandatory No Yes No
25 Any payment gateway involved during transfer No Yes Yes
26 How many banks offer this payment method 21 Almost every bank in India offers this payment method NA
27 Can you pay anyone with this payment method No. As of now only an individual or merchant. Anyone i.e. individual, merchants, various service providers Anyone i.e. individual, merchants, various service providers
28 Can you do eCommerce transactions No Yes Yes

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