The key move towards a cashless economy of India which seems like some futuristic sci-fi movie is now a reality! The Unified Payment System interface has been launched and will be live in the upcoming 2 to 3 working days. This app is expected to be available on the Google Play Store and for customers to download and use. Currently the app supports 19 banks Axis Bank, Andhra Bank, Maharashtra Bank, Bhartiya Mahila, Canara Bank, Catholic Syrian Bank, DCB Bank, ICICI Bank, Federal Bank, TJSB Sahakari Bank, Oriental Bank of commerce, Karnataka Bank, UCO Bank, Union Bank, United Bank of India, Punjab National Bank, South Indian Bank, YES bank and Vijaya Bank.
What is this new app called UPI how will it help the users?
This is simply a payment transfer system that allows transaction of money from one bank to another with the use a of a simple smartphone application.
With UPI there will hassle free payment procedures from bank accounts to different merchants which will be available both offline and online and will not have any hassles of typing in the credit card details or IFSC code. It will also not require a wallet banking system with passwords or the hassle net banking.
This UPI system (Unified Payments Interface) has been developed by the NPCI (National Payments Corporation of India) which is the umbrella organization that regulates all the retail fund transfers within the nation. As per financial sector experts, this new system may soon replace the existing systems of IMPS, NEFT and RTGS, that are heavily used in today’s times.
How to use the UPI application?
To use the UPI app all you need to do are described in these following steps:
- Download the application from UPI
- Set the app login information
- Create a virtual address
- Add the details of your bank account
- Provide an M-Pin
- And voila you can start transacting using UPI
What kinds of stuff can one pay for using the UPI?
Remittances, merchant payments, bill payments and other kinds of transactions
How does the UPI system work?
A unique UPI Id will be created for the person using the UPI interface which will use the phone number that is linked to their bank accounts. This ID is almost similar to an ordinary email ID. For instance, if one’s mobile number is 123456789 and they have a bank account with Punjab National Bank, thn their ID will read as follows: 123456789@PNB.
To send funds the user must open their UPI app installed on their smartphone device, then go to the send money option and facilitate the transactions using the UPI mode. For adding the recipient details the user must input the details of the recipient like 123456789@UBI. And soon the money will be transferred to the recipient’s bank account once the recipient has been approved by the sender.
How safe is the UPI system?
The UPI system is safe as the users only share a virtual address and do not provide any other sensitive information.
Are there any transaction limitations to the UPI system?
The limit per transaction is INR 1 Lakh only.
5 points you must know about the UPI:
- With the launch of the UPI one will no longer need to wait for hours for the NEFT to be delivered. They will also need to seek for MMID code for the IMPS transactions any longer.
- The UPI system during its first soft launch on April was described by the RBI Governor Raghuram Rajan as a system that will transform your smartphone into a payment banking system. All one needs is a smartphone with this smart app to make or receive payments when conducting retail purchases.
- Currently the NEFT and RTGS systems are widely in use for money transfers that require sensitive information of the recipient like account number, IFSC code and others. But with the UPI system only the mobile number will be enough of the recipient for quick money transfers during anytime of the week.
- Also shopping can be hassle free and the need to carry a credit or debit card will not exist with the UPI system, as one can use its integrated payments system to make merchant payments as well. With UPI the fund transfer from your account to the merchant’s will happen instantaneously.
- This system of money transfer using UPI will be available 24*7, 365 days including the holidays as well. One can choose to transfer funds from India to any other foreign country using this UPI system. Simply download the app, open it and add the amount to be paid to beneficiary, furnish the beneficiary’s unique Id and tap on send. Once you confirm the password on the app the fund will be transferred instantly.