3. WHAT IS UPI?
• UPI stands for Unified Payments Interface,
which is an instant real-time payment system
developed by the National Payments
Corporation of India (NPCI) to facilitate digital
payments using a mobile phone.
• UPI is built on top of the Immediate
Payment Service (IMPS) platform and
provides a user-friendly interface for
making instant fund transfers.
4. OVERVIEW
UPI allows users to send and receive money
instantly, 24x7, without the need for bank
account details or IFSC codes.
UPI also allows users to link multiple bank
accounts to a single VPA, making it easy to
manage transactions across different
accounts.
5. OVERVIEW
UPI is interoperable across different banks,
which means that users can send and receive
money from any bank that is part of the UPI
network.
UPI also provides a user-friendly interface for
making transactions, with features such as QR
code scanning and biometric authentication.
6. UPI-enabled
apps such as
PhonePe, Google
Pay, Paytm, and
others provide
the interface for
users to initiate
UPI transactions.
01
PAYMENTS
APPS:
02 03 04
Payment Service
Providers (PSP):
PSPs facilitate UPI
transactions by
integrating with banks
and providing UPI
services to merchants
and users.
PAYMENT SERVICE
PROVIDERS (PSP)
Banks: Banks play a
crucial role in the
UPI ecosystem by
providing the
underlying accounts
and infrastructure
for UPI transactions.
BANKS
NPCI (National
Payments Corporation
of India): NPCI operates
the UPI platform,
overseeing its
development,
management, and
regulation to ensure
seamless and secure
transactions.
NPCI
There are four things that work together to make a transaction successful
7. FLOW OF
TRANSACTION
Initiation
The payer initiates the transaction by entering the recipient's Virtual Payment
Address (VPA) or scanning their QR code using a UPI-enabled mobile app.
Authentication
The payer authenticates the transaction using a UPI PIN or biometric authentication.
PSP Involvement
The Payment Service Provider (PSP) of the payer and the payee are involved in the
transaction. The PSP of the payer verifies the transaction and debits the payer's
account. The PSP of the payee receives the transaction details and credits the
payee's account.
8. FLOW OF
TRANSACTION
Bank Involvement:
The banks of the payer and the payee are involved in the transaction. The bank of the
payer verifies the transaction and debits the payer's account. The bank of the payee
receives the transaction details and credits the payee's account.
NPCI Involvement:
The National Payments Corporation of India (NPCI) operates the UPI platform and
oversees the transaction process. The NPCI facilitates the transfer of funds between
the banks of the payer and the payee.
Transaction Completion:
The transaction is completed instantly, and the funds are transferred from the payer's
account to the payee's account.
9. THE FUTURE OF UPI
Growth Prospects:
UPI has witnessed remarkable growth,
with its transaction volume expected to
reach 1 billion per day by 2026–27,
compared to 1 million in October 2016.
It accounted for around 75% of total retail
transaction volume in 2022-23 and is
predicted to grow four-fold by 2026.
10. THE FUTURE OF UPI
Growth Prospects:
UPI has witnessed remarkable growth,
with its transaction volume expected to
reach 1 billion per day by 2026–27,
compared to 1 million in October 2016.
It accounted for around 75% of total retail
transaction volume in 2022-23 and is
predicted to grow four-fold by 2026.
11. THE FUTURE OF UPI
India's UPI system has been expanding globally, with several countries expressing
interest in adopting it. Some of the countries that have already adopted UPI include
France, the United Arab Emirates, Sri Lanka, Nepal, Bhutan, and the United
Kingdom.
12. RECENT
DEVELOPMENTS
Offline UPI Transactions: NPCI
recently unveiled a host of
innovative features for UPI,
including offline UPI transactions,
instant credit via UPI, UPI Lite X for
Offline Payments, Tap and Pay, and
Hello UPI. These advancements are
poised to further propel UPI into the
digital payments stratosphere.
13. UPCOMING FEATURES
UPI Lite X for Offline Payments: UPI Lite
X is a new feature that enables offline
UPI transactions, allowing users to make
payments even when they are not
connected to the internet.
Tap & Pay: The Tap & Pay feature is a
near-field communication (NFC)-enabled
feature that allows users to make
payments by tapping their smartphones
on a compatible payment terminal.
14. CONCLUSION
To summarize, UPI has revolutionized India's digital payments industry, providing
unmatched convenience and efficiency. Its secure and seamless payment
infrastructure allows for instantaneous transactions and a diverse range of financial
activities, making it a prominent unifying force in the nation's digital payments
landscape. As UPI continues to develop, it is poised to play a crucial part in shaping
the trajectory of global digital payments.
