It was night on 8th of November and as usual I had switched to DD NEWS to get my daily dose of news. For couple of years I have stopped watching any other NEWS channel due high intensity noise that raises anxiety levels in me. DD NEWS has its own problem being forced to highlight government moves as well air NEWS related to Information & Broadcasting Minister who these days is Venkaiah Naidu, even when related NEWS are not of that importance. But anyways let me not digress and to my surprise I saw Mr. Modi addressing the nation live. I did not believe initially when heard that from Midnight of 8th November 500/1000 denomination of notes would not remain valid.
Now this was something of a radical move for our generation as we had never heard of steps like that. Later I realized it has happened in India earlier once in 1946 and another time in 1978. The effects of this move on the economy, on reduction in corruption, terrorism funding, real estate and so many other things is a moot point. I think its better to wait and see how all this pans out in coming future.
But there is one thing for sure, there is a chance to learn new things for everyone. I am sure there are many views that the poor uneducated people in our country who will face lot of difficulties and there is no denying of that fact. In today’s world lot of people are not comfortable with online buying, e-wallets, online banking and so many such things that can make their life easy.
Here I would like to write about United Payment Interface (UPI) which I understand can be a revolutionary in taking mobile banking to another level. National Payment Commision of India an umbrella organization for all retail payments system in India setup under guidance of RBI and IBA.
UPI is an interface which allows users to transfer money instantly from their bank account to anyone else’s bank account without worrying about which banking company the account is held.
In a laymen terms it is like creating an e-mail address first which is done by installing any of UPI apps on the App Store. Once you have a valid e-mail address you can send e-mail to anyone without worrying about if account is with Gmail, Yahoo, Outlook or any other e-mail.
When one installs a UPI app of any bank, one is assigned with Virtual Payment Address (VPA) which is more like e-mail address. Once you are logged into app, it can add bank accounts based on mobile number that is attached to the Bank Account automatically. In order to do transaction user needs to create a MPIN which can be done through the App itself. With MPIN created the money can be transferred to one bank account to another though the App using the MPIN directly. Money can be transferred based on VPA or mobile number but one needs to make sure that the user with the mobile number has any UPI app installed. Also if multiple accounts are mapped to the same mobile number the first account which is added on the app is used by default to credit money back into account.
UPI transaction happens directly to account and hence your money doesn’t get stuck in various e-wallets. Currently UPI transactions are not getting charged but eventually it will incur charges similar to IMPS transaction which around Rs 5 per transaction.
UPI is a neat idea and is backed by NPCI which is a Government of India body with full support of RBI. As far as security is concerned I believe it is no worse than any other existing wallet. The transaction are controlled by MPIN and as soon as it happens you get a SMS/e-mail regarding the transaction, so any security breach can be identified and transaction blocked
Current limits on transaction are 1 lakh limit per day. 20 transactions max in a day.
I have used PhonePe App and it has worked well for me. If you install the app do the first transaction you make Rs 50. So go ahead and use UPI. With less Marketing Budget than PayTM, UPI was not able to get Modi Ji on front page of TOI but hoping word of mouth creates enough traction for it
Featured Image attributed to: By National Payments Corporation of India – http://www.nearex.com/first-impressions-of-upi-as-an-user, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=52097360