What is the Future of UPI Payments in India?

What is the Future of UPI Payments in India?

Ever since its launch in 2016, UPI has been constantly revolutionising the Indian payment system. The surge of the pandemic has also led to a better reach and adoption of the UPI payments system. But what about its future? What is the future scope of UPI payments in India? Read this blog to find out.

Introduction:

In the rapidly growing digital world, people don’t have time to visit a bank to make payments. They opt for an easy, quick, and convenient way to fulfil all their banking activities. This is where digital payment methods come in.

There are several online payment service providers that allow a quick and secure transaction process between people.

The Unified Payment Interface (UPI) is one such payment system. It was launched in 2016 by the National Payments Corporation of India (NPCI) and the Indian Banks Association (IBA).

What are UPI payments:

The Unified Payments Interface (UPI) is a system that integrates various bank accounts into a single mobile application (of any participating bank), enabling smooth fund routing and merchant payments.

Additionally, it supports “Peer to Peer” (P2P) collect requests that may be planned and paid for according to need and convenience. UPI payments play a vital role in the digital payments of the country.

UPI has given consumers a convenient and quick payment mechanism for online or offline shopping. Over 150 apps that facilitate UPI payments are available in the Play Store and App Store, and leading e-commerce operators have also launched UPI products.

Integrating with a suitable payment gateway is necessary to get the maximum benefits of UPI payments.

The payment gateway must be able to facilitate a secure and seamless way of accepting and managing online payments. It should support multiple payment solutions and provide a high transaction success rate.

Features of UPI payments:

Some of the key features of UPI payments are

• Immediate Payment Service (IMPS) enables instant fund transfers, even faster than NEFT.
• Since UPI is entirely digital, its services are available around the clock (24/7) and on all federal holidays (365 days).
• Access multiple bank accounts using a single mobile application.
• Uses Account Number with IFS Code and Mobile Number with MMID or Mobile Money Identifier and Virtual Payment Address, a special ID provided by the bank.
• Available via USSD service, where customers can use the service by simply dialling *99# and selecting one of the offered services, such as balance inquiries, MPIN changes, fund transfers, and sending and receiving money.
• Each bank offers a unique UPI for various versions of Android, Windows, and iOS.
• Provides bill-sharing service.
• Best for making merchant payments, utility bill payments, in-app purchases, over-the-counter purchases, and payments based on barcodes.
• A complaint may be sent straight via a mobile app.

UPI – a convenient and secure payment system:

The main reason customers and merchants opt for digital payments is for their convenience and security, and UPI provides just that.

UPI provides a secure and seamless transaction experience, which has led to the vast adoption of the payments interface. Let’s look in detail at the convenience and security of UPI payments.

Convenience:

UPI provides its users with a convenient and easy payment service, whether for person-to-person (P2P) transactions or online or offline shopping.

UPI offers its services around the clock (24/7) without any fee. Several banks and payment providers have adapted UPI payments into their services, enabling a smooth transaction process between customers and merchants. 

The growth of digital payments has made it easier for people from rural areas to make payments. They don’t have to travel to banks for a simple fund transfer and can make payments from their place using UPI.

Even people who are not aware of technological developments can use the QR code and other payment features of UPI.

The one-click payment feature of UPI allows for a faster transaction process. Customers don’t have to enter their bank details every time they make a payment. They just have to enter their UPI pin to authorise the payment.

Security:

One of the main reasons for the popularity and mass adoption of UPI is the security features offered by the system.

It offers security measures like mobile number verification and two-factor authentication. Moreover, the launch of UPI 2.0 has increased security features by including signed intent for QR payments and viewing invoices before making payments.

Mobile number authorization:

Mobile number authorization is the first stage of security in UPI payments. The user has to link their mobile number with the UPI during the initial login process. UPI verifies your identity and approves the registration. If the user changes their mobile number, they have to do the verification process again.

Two-factor authentication:

This is the second security feature of UPI payments. It is enforced while making the transaction through MPIN (Mobile PIN).

The users are given the option to set an MPIN during the registration process. The MPIN is a 4 or 6 number pin that the user has to enter while making a payment. This pin is privy only to the user and ensure no one else uses your account.

QR code security:

With the signed intent in QR code payments, customers can verify the authenticity of the merchants. This feature ensures that the customers are not scammed by fraudsters who tamper with the QR codes.

Invoice before payment:

Another important benefit of using UPI is that you are able to check the invoice of your payment before making the transaction. The customers can verify the payment credentials and approve the transaction.

So far, we have learned about what UPI is, its features, security measures, and how it is a convenient mode of payment for customers and merchants.

With the launch of UPI 2.0, the number of merchants and customers who opt for UPI payment methods is only going to increase more than ever.

A look into NTT DATA Payments Services:

NTT DATA Payments Services is one of the top online payment service providers that work across 50+ countries, including Japan, the USA, China, Canada, and South Korea.

It provides services to more than 6 million merchants. They are integrated with over 50 banks and have over 100 payment options. Some of the services offered by NTT DATA Payments are

• Online Payment Gateway
• POS Machines
• QR Code
• IVR
• Mobile Application

NTT DATA offers customised payment solutions for merchants from different fields of work, including education, travel and tourism, healthcare, gaming, retail, etc. It helps businesses easily create payment reports and track and manage all customer payment records.

Conclusion:

The launch of UPI has made instant and secure money transfers from one bank to another possible. The QR code system also allows people to go cashless and pay with their mobile phones. UPI is only expected to improve and develop more in the future.

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