UPI-Next Watsapp of Payments/NPCI

There were times when financial transaction were done standing in long queues at the banks. Then came internet banking and online transfers(NEFT/RTGS) where we add a beneficiary(using its account number and IFSC details); wait for beneficiary to be activated for couple of hours and then chuck your balance from your account to the beneficiary account. But then came security issues with sharing account details, card details which led to the invention one more payment solution Virtual wallets/E-wallets(Paytm,zappy,ola money,ICICI pockets etc) wherein the posed security threat is taken care of by just adding a top up to virtual wallet from your account; hence the virtual wallet is used for transactions. But lately NPCI has launched one more successful mode of payment which is all the more powerful: UPI(Unified Payment Interface) or Enhanced IMPS

Background of UPI:

  1. You would just need a virtual address linked to your bank accounts or your could generate using any of the unique IDs like your Adhaar or mobile number.
  2. A M-Pin : for 2FA  mandate by RBI.

How does it work:

  1. A virtual address(VA) is generated by your bank eg: abc@icici.
  2. So you could just share your VA with the merchants.(Once they accept payment from UPI).
  3. Hence the payments would be directly debited/credited from your accounts.
  4. These transactions would be displayed as IMPS transactions in your bank statements.
  5. So now to transact you would need a smartphone with an UPI app.(At the end I would share some of the examples.)
  6. This would be a P2P & P2M transaction which would be authenticated using mPIN that might be provided once you apply for mobile banking support.


  1. No need of remembering account details, pins, card details.
  2. For merchants its not T+3 settlement time.
  3. No more waiting for OTPs.
  4. Adhaar/mobile number integration for unique VA.


  1. Refunds are not a part of UPI currently.
  2. UPI currently has a capping limit of 1 Lac.
  3. Wallets are not included into UPI.

Currently there are 21 banks supporting these facilities with their corresponding Android app:Andhra Bank, Axis Bank, Bank of Maharashtra, Bhartiya Mahila Bank, Canara Bank, Catholic Syrian Bank, DCB Bank, Federal Bank, ICICI Bank, TJSB Sahakari Bank, Oriental Bank of Commerce, Karnataka Bank, UCO Bank, Union Bank of India, United Bank of India, Punjab National Bank, South Indian Bank, Vijaya Bank and YES Bank.

Platforms using UPI:

  1. Razorpay: First payment gateway to integrate UPI.
  2. PSP like CitrusPay too are joining hands to enable their customers with the revolutionary payment mode.
  3. Instamojo
  4. PayU
  5. Finmo

Some featuring apps using UPI:Axis Pay,Trupay and many more.

At the end I feel we should all thank Mr. Raghuram Rajan for such a revolutionary farewell  gift launched before he could bid us goodbye. So its going to be tough time for private wallet players to sustain the tornado originated from NPCI with support from DIGITAL INDIA…fasten your belts or should I say fasten your wallets before they are blown away.



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