UPI: All you need to know as a Customer And Merchant.

What is UPI?

UPI stands for Unified Payment Interface. It permits us the transfer money from one bank account to another instantly through a smartphone. Payments can be made through an app on a mobile device only. The money transfer via UPI works 24×7.

How does it work?

For using UPI, the user need to create a Virtual ID or Virtual Payment Address (VPA) of his/her choice to link UPI to any bank account. This process does not need any recipient or payer to share bank details. The VPA acts as financial address and there is no need to remember beneficiary account number, IFSC code or net banking user ID/password for sending or receiving money.

Registration

Registration in 3 simple and easy steps:

  • Firstly, the user needs to download the UPI application from the App Store / Original website of the bank.
  • Secondly, the user has to create his/ her profile by entering details like name, virtual ID (payment address), password etc.
  • And lastly, the user has to Add/Link Bank Account with the virtual ID.

Generating M-PIN (Mobile-banking Personal Identification number)

  • Firstly the user has to select the bank account from which he/she wants to initiate the transaction.
  • Secondly, the user has to click on create/change M-PIN option.
  • Now user has to type debit card expiry date along with the last 6 digits in the relevant field.
  • And now the user has to type the OTP pin generated by his/her bank and sent to his/her registered mobile number.
  • Lastly, the user needs to set the desired M-PIN and click the Submit button.

Benefits for Merchants

  • There is no risk of storing customer’s details like in Cards.
  • You can enjoy Seamless fund collection from customers.
  • Your customers don’t need any credit/debit card for payment, they can directly pay you from UPI which is linked with their bank account.
  • UPI is Suitable for both E-Commerce & M-Commerce transactions.
  • It resolves the Cash On Delivery collection problem.
  • It provides a single-click two-factor authentication facility to the customer (seamless Pull).

Benefits for Customers

  • UPI have 24*7 availability.
  • It is a Single Application for accessing different bank accounts
  • The use of Virtual ID is more secure, here you don’t need to share any credentials.
  • It provides a single-click two-factor authentication facility.
  • Customers can raise Complaint from Mobile App directly.

Minimum requirement for UPI transaction

  • First, you need a Mobile phone with internet facility.
  • Secondly, you need a UPI application with a registered bank account linked.
  • And lastly, you need Registered MPIN.

Advantages of using UPI

  • With UPI, the user’s bank account can be used as a wallet with a simplified two-factor authentication which eliminates the need to store funds in any other wallet.
  • Use of Virtual ID makes it more secure, as there is no need to share credentials.
  • UPI transaction can be made via IMPS in real time, which makes it available 24*7.
  • Users can link multiple bank accounts to a single Phone. Hence, sending or receiving money across banks gets easier.
  • For merchants, it is Suitable for electronic Commerce and a mobile Commerce transaction (E-commerce and M-commerce) as well as it resolves the Cash on Delivery (COD) collection problem.
  • Banks can create their own application interfaces as UPI provides flexibility and an open architecture.

Security Measures

  • Be aware of Mobile phishing, keep in mind that you always download the UPI applications from the bank’s official website, and be cautious before you download them from the App store.
  • You need to set strong passwords for your phone as well as for your UPI application.
  • Do not share your MPIN with anybody (not even with the bank).
  • Use biometric authentication for your UPI app, if possible.
  • Update your mobile and applications from time to time, to be secure from vulnerabilities.
  • It is advisable for users to enable encryption, and download anti-virus software on the phone.
  • Keep your SIM card locked with a pin to avoid misuse.
  • In case of loss or theft of the mobile device, You can contact your subscriber to block the subscription of the SIM card.
  • Don’t connect your phones to unsecured wireless networks that do not need passwords to access.

Enalo provides payment collection facility through UPI.

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About the Author: Ahraaz Makhdoomi