UPI: Brief Synopsis
Unified Payments Interface (UPI) is a cross-bank payment transfer system that allows customers to transfer money using the platform. It is standardised across banks and allows a person to initiate a money transfer transaction from anywhere with the click of a button.
It was introduced by the National Payments Corporation of India (NPCI) in August 2016. After the launch of demonetization drive, UPI is being used frequently to make online payments. UPI has gained popularity fast and receives thousands of sign-ups every day.
Different online merchants and platforms now accept payments using UPI for online businesses. One of the main reasons behind the popularity of UPI is that you can sign up and generate a password, known as M-PIN, and use it to carry out transactions from anywhere.
The merchant never gets access to your actual account number and other details when you make payments using UPI. He only gets access to your virtual address, that you use with UPI. It makes this payment system far more secure than other quick payment platforms out there.
It also makes it easy to carry out payments since you do not have to enter your card details, account number, IFSC Code, etc. to complete the payment. Your virtual address is sufficient to complete the transaction.
Here are the three types of transactions you can do using UPI:
- Money Transfer: Without the need to enter details such as account number, card number or IFSC code, you can transfer money to the account of any of your friends and family.
- Merchant Transactions: You can use UPI enabled apps to purchase groceries, clothes, or movie tickets online. Some apps also run attractive offers that bring you reward points or discounts too.
- Bill Payment: You can pay your utility bills using the UPI payment system easily. There is no need to stand in long queues to pay your bills anymore.