How UPI will turn your mobile phone into a bank

The government announced the Unified Payment Interface for 21 banks last week.

The app is a boon for cashless payments to be made by the customers from their mobile phones.

The app has been developed by National Payments Corporation of India (NPCI)

UPI is a payment solution which 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 2-factor authentication.

Here's how UPI works.

• You need to have a bank account and a smartphone to operate UPI.
• Download the UPI-enabled app from the bank's website or Google Playstore.
• To make a unique id, you will have to enter details such as name and age. The unique id can contain your name, phone number and Aadhar number.
• Create your profile with bank name, account number, IFSC code and link it to your mobile number.
• Select the bank account. Generate M-PIN, enter last six digits of debit card and expiry date. Enter OTP received on mobile and secret M-PIN. Press submit button.
• Use the UPI app to send money and requesting funds by sharing your virtual id.

The key advantage of using the UPI app is that you can use the service round the clock during the year, unlike NEFT or RTGS services that can be operated for a specific number of hours.

 

The per transaction limit is Rs 1 lakh and it will cost you 50 paise per transaction.

A consumer can make the payments for products brought online through the UPI app. Merchant payments, paying utility bills, over the counter payments, bar-code based payments, donations, school fees and remittances are among other transactions facilitated via UPI.