More and more digital payments banks and digital wallets are now integrating with the Unified Payments Interface (UPI). This trend has been seen because UPI transactions have been seeing an exponential rise, hitting almost 77 million in October. In fact, many banks have even gone on to rename their bank apps to include Bharat Interface for Money (BHIM). An example of this is the State Bank of India UPI app, which renamed itself BHIM SBI Pay.
Recently, Samsung Pay, a mobile wallet owned by Samsung, not only integrated with UPI but also supports the Bharat QR-code interface. This will allow users to make payments to all UPI merchants using the ‘scan & pay’ tool that will be available through the Bharath QR code facility.
UPI is a type of payment system that has been launched and developed by the National Payments Corporation of India (NPCI) in an effort to promote cashless payments in the country. The main objective behind this initiative is to make fund transfers more easy for all sections of the society.
The UPI interface works based on the Immediate Payment Service (IMPS) and the entire system is regulated by the Reserve Bank of India. The main advantage that UPI offers over other methods of fund transfer is that the fund transfer is instant and real time. Also, there is no need to go through the cumbersome process of adding a beneficiary, or entering their account number and IFSC code. All you need for a fund transfer is a virtual address also known as a Virtual Payment Address (VPA). To send money through a UPI app, all you need to do is enter the VPA of the payee or beneficiary. One can also request for money through the UPI-enabled app by making what is known as a ‘Collect’ request. This can be initiated by keying in the VPA of the payer and giving them a certain deadline to send the funds.
The UPI interface is free and there are no transaction costs unlike other types of fund transfer methods such as IMPS, NEFT or RTGS.
Bharat QR code is basically a type of payment system through which a user can scan a code at a merchant location and make payments. Here, these is no need to swipe a debit or credit card physically. Samsung Pay will now provide customers the facility to pay through Bharat QR code.
- Step 1: Download and open any app that is compatible with Bharat QR code
- Step 2: Go to the ‘Scan & Pay’ option and click on the same.
- Step 3: The camera will open up, now scan the QR code
- Step 4: Enter the transaction amount and make the payment using an Mpin/ password
- All merchants can take a print out of the code and display it in their outlet. However, even a soft copy will do
- Most major payment gateways and bank apps now accept QR code
- QR code payments can be made through any bank app that has the Bharat code feature
- Simply scan and enter code to authorize the payment
- Bharat QR code is available on UPI based platforms
- No transaction fee or other charges for paying using Bharat QR code
- Interoperable with all bank accounts
- Bharat QR code has an open payment interface
- No need to physically carry debit or credit card
- Faster payments can be made through this method
In fact more and more banks in the country, both public sector and private banks, are collaborating with UPI and will soon fall under BHIM. These banks will go on to exhibit BHIM as a prefix before their own bank name in an effort to help users identify the apps in the market that come with the UPI interface. For those in the banking sector, this is nothing but another way to market their brand and show customers the different payment options that are given to them. Another reason for this exercise is to help merchants who receive payments through the UPI interface, to accept payments without any type of confusion. Also, this move will also help UPI gain an identity as a single handed platform that enables seamless digital payments.
Another advantage of UPI, is that it is interoperable. This means that even if you do not have an account in a certain bank, you can still download the app to use the UPI interface without any hassle. This is one of the main advantages of UPI over other types of payments banks or digital wallets.
At present, there are more than 60 banks that have collaborated with the UPI and almost all of these bank apps are interoperable.
Apart from banks, there are also many popular payment apps and digital wallets that have now integrated with the UPI platform. These include Paytm, Airtel Payments Bank, PhonePe, Chillr, Google Tez, etc. The benefit that UPI offers is that there is no need to recharge your wallet or add money. All transactions are carried out directly from the customer’s bank account through in a safe and secure manner.
- Download any UPI-enabled app
- Register by verifying phone number, giving personal and account details
- Create a VPA
- Set up MPIN
- Send money using VPA
- Collect money
- Scan & pay
The digital payments scene is expanding in the country and there are many players that are coming into this space. In October, the number of digital transactions skyrocketed to 965 million, according to reports obtained from the RBI. These transactions included payments through PPIs, credit and debit cards, Unstructured Supplementary Service Data (USSD) and UPI.
UPI has changed the way Indian’s bank by providing a single interface solution for fund transfers. The system is much quicker, works on a 24/7 basis and on all 365 days in a year, even on bank holidays.
Authored By Ileyana Lyardson
She is a content marketer and financial writer by day and a reader by night. She has 7 years of experience in the financial domain, predominantly in the Bank’s business. She is passionate about travelling and also maintains a blog where She offers financial advice and review of Banks IFSC to individuals planning their featured life.