The economy of India was dominated by the use of cash half a decade back. There were only a few online payment methods such as National Electronic Funds Transfer (NEFT), and Real-Time Gross Settlement (RTGS). However, the tables turned with the birth of the vision for cashless India. The Reserve Bank of India wanted to make the existing payments system strong and streamline the settlement system with simpler and safer digital payment methods. A huge revolution occurred in the economy of India with the development of the UPI payments system- a real time payments platform.
An overview of the unified payments system
The UPI payment system was developed & is regulated by the National Payments Corporation of India (NPCI). The ulterior motive if this collaboration was cashless economy driven digital payments.
The UPI payment system synced perfectly with the increased use of smartphones. It is a mobile-based payments system allowing instant transfer or collection of funds between two accounts or two banks. Once you have registered your account with UPI, you need not go through the hassle of typing account number and other bank details every time you make some transaction. You can download any of the UPI apps from the play store and log in using your respective mobile number registered with the bank. You have to set a UPI pin, which is to be during every transaction.
They are used for both Peer-to-Peer (P2P) and Peer-to-Merchant (P2M) transactions. It can also be used for various value-added non-financial transactions like checking real-time balance and history of transactions.
What is the reason for traction among the masses?
The interoperability of the payments system and its ease of use interface make it popular and stand out apart from other payment solutions. The portable nature of the bank adds to the popularity of the real-time payment solution. This means that you can link your bank account to a UPI app provided by another bank or any app such as Google Pay. Also if a user has multiple bank accounts, they can link to a single UPI app. This drives easy payment from one account to another without entering different account numbers each time. When convenience is the key, its popularity cannot be questioned.
The simplicity of transactions is achieved by the use of a virtual payment address. The VPA searches and identifies themselves with another consumer without providing the bank account details. The VPA also helps in lowering the risks of fraud.
A wide array of features has paved the way for such huge popularity of the UPI solution. Apart from being a robust payments system for personal transactions, UPI offers great benefits for businesses. Merchants can use their mobile as a tool for the acceptance of payments. This brings down the cost of transactions compared to the traditional system like Point of Sale (POS) and QR code-based payments. The upgraded version of UPI offered benefits to the merchants such as pre-authorize a transaction, overdraft accounts on UPI, and stronger verification.
Unified Payment Interface Solution
We at finacus provide the best Unified Payment Interface (UPI) platform with an API interface and mobile interface for consumers. It helps in addressing today’s digital transaction challenges with a simple interface.
With about three forth merchants using UPI solutions, it is time for you to adopt a robust UPI platform. Know more about our solution FinUPI. Ask for a Demo Now.