National Payments Corporation of India (NPCI), the umbrella organisation for all retail payments system in India on Thursday said that the Unified Payments Interface (UPI) was live for customers of 21 banks.
UPI is a payments solution that empowers a recipient to initiate the payment request from a smartphone. It facilitates virtual payment address as a payment identifier for sending and collecting money and works on single-click two-factor authentication. It also provides an option for scheduling push and pull transactions for various purposes such as sharing bills among peers.
Built on top of the IMPS (Immediate Payment Service platform), UPI needs to have the beneficiary’s UPI ID - a virtual identity like an email address. This could be your name, or your phone number, so for example, if your phone number is 1234567890, then your virtual address could be 1234567890@sbi (if your bank is SBI) or 1234567890@icici (if you’re an ICICI bank customer), and so on.
One can use the UPI app instead of paying cash on delivery on receipt of product from online shopping websites and can pay for miscellaneous expenses like paying utility bills, over-the -counter payments, barcode (scan and pay) based payments, donations, school fees and other such unique and innovative use cases.
Outgoing Reserve Bank of India governor Raghuram Rajan had announced the pilot of UPI on April 11, 2016. UPI was run for the last few months as a pilot with employee-customers. The purpose of the pilot run “was to ensure that technical glitches, if any, are fixed and the product gives a smooth experience for immediate pay and collect with Virtual Payment Address (VPA).”
“This is a success of enormous significance. Real-time sending and receiving money through a mobile application at such a scale on interoperable basis had not been attempted anywhere else in the world. Now the UPI App will be made available on Google Play Store by banks,” AP Hota, MD and CEO of NPCI, said.
The relevant details of the service would be available on the website of 21 banks.
After assessing the success of pilot run, RBI had accorded their final approval for public launch of the product. NPCI had decided that only the banks with 1,000 pilot customers, 5,000 transactions and success rate of around 80% would be permitted to go live.
Some of the banks that are going live with UPI are - Andhra Bank, Axis Bank, Bank of Maharashtra, Bhartiya Mahila Bank, Canara Bank, Oriental Bank of Commerce, Union Bank of India and Vijaya Bank, Karnataka Bank, UCO Bank, Union Bank of India, United Bank of India, Punjab National Bank, South Indian Bank, Vijaya Bank and YES Bank among others.
Analysts have also appreciated the launch of the new payments interface. “UPI is an unique world-class platform aimed at removing friction faced by customers during merchant payments through set up of an interoperable platform and an important step in India’s journey of reducing cash and improving inclusion,” Vivek Belgavi, leader at the FinTech divison of PwC India, said.