What Is UPI? Basic Of UPI

What Is UPI? Basic Of UPI

Unified Payments Interface (UPI) is a real-time payment system. It enables users to link multiple bank accounts to a single mobile application and make seamless fund transfers between these accounts. UPI allows users to send money, pay bills, and make online transactions directly from their bank accounts using a mobile phone.

UPI full form: Unified Payments Interface (UPI).

NPCI full form: National Payments Corporation of India (NPCI).

VPA: Virtual Payment Address (VPA).

What is UPI?

UPI is a popular mobile payment method that allows to transfer of money from one bank to another. This transaction is instantly and free of charge.

To transfer money through UPI requires a UPI ID for both sides of the user.

UPI has gained popularity in India due to its convenience, speed, and interoperability between different banks. It has become a widely used platform for digital payments and has contributed significantly to the growth of the digital economy in the country. National Payments Corporation of India (NPCI) developed the Unified Payments Interface (UPI).

What is UPI ID?

UPI ID is a unique identification of a bank account, that allows users to send and receive funds.

It is a unique identifier associated with a user for making digital payments through the UPI system. It is often referred to as a Virtual Payment Address (VPA). UPI IDs are used to identify and receive funds during UPI transactions.

How does the UPI work?

  1. Registration:
    • Users need to register with their bank for UPI services.
    • They create a unique UPI ID (Virtual Payment Address or VPA) linked to their bank account.
  2. Mobile App:
    • Users need to download a UPI-enabled mobile app provided by their bank or a third-party app.
  3. Linking Accounts:
    • The UPI app allows users to link multiple bank accounts using their UPI ID.
  4. Transactions:
    • Users can initiate transactions by selecting the recipient’s UPI ID or scanning a QR code.
    • Various transactions supported include peer-to-peer fund transfers, bill payments, and online purchases.
  5. PIN Authentication:
    • Each transaction is secured with a UPI Personal Identification Number (PIN) that the user sets during the registration process.
  6. Real-time Settlement:
    • UPI transactions are processed in real-time, providing instant fund transfers between accounts.

What are the charges and limits per day?

UPI Charges: It’s free. (might have charges for certain cases).

UPI limit per day: Vary.

Generally, it’s free for users to do peer-to-peer transactions. However, charges might apply for certain services and uses.

The transaction varies from bank to bank. In general, it is near about 1 lakh per account.

Best UPI apps?

There are several UPI-enabled apps provided by different banks. Also, there are third-party providers.

  1. Google Pay:
    • Google Pay formerly known as Tez, was developed by Google. This app allows users to link their bank accounts and make UPI transactions. It also offers other features such as bill payments and mobile recharges.
  2. PhonePe:
    • PhonePe is a UPI-based digital payments app owned by Flipkart. It enables users to send money, pay bills, and purchase online. PhonePe also offers additional services like mutual fund investments and insurance.
  3. Paytm:
    • Paytm is a widely used digital payments platform that started with mobile recharges and bill payments and expanded to include UPI transactions. Paytm also provides services like mobile wallets and online shopping.
  4. BHIM (Bharat Interface for Money):
    • BHIM is a UPI app developed by the National Payments Corporation of India (NPCI). It is designed to be a simple and secure way to make UPI transactions. BHIM is not limited to any specific bank and can be used with multiple banks.
  5. Amazon Pay:
    • Amazon Pay, offered by Amazon, is a UPI-enabled digital wallet that allows users to make payments for products and services on the Amazon platform. It also supports peer-to-peer transactions.
  6. WhatsApp Pay:
    • WhatsApp Pay allows users to send and receive money through the WhatsApp messaging platform. It is integrated with UPI, and users can link their bank accounts to facilitate transactions.