Unified Payments Interface (UPI) is a payment interface lauunched by National Payments Corp. of India (NPCI). The purpose of UPI is to allow banking payments from one account to another without the need for full bank account details. UPI provides the bank account holders with virtual addresses such as paisawise@sbi or paisawise@icici, which is used to identify the associated bank account at the right bank and enable the payment transaction.
UPI is expected to simplify e-commerce payments and make person-to-person payments fairly easy. With UPI, one does not need the bank account number, IFSC or any other bank account details. A simple UPI address is all that’s required for sending a payment.
UPI works on IMPS (Immediate Payment Service), which allows bank customers to transfer funds across different banks using a virtual address such as yourname@bankname round the clock, 24×7. Banks will provide you the ability to create your UPI address for use in such payment transactions.
UPI enables bank account holders (of banks that have enabled UPI) to send and receive money using a Virtual Payment Address (VPA) without entering additional bank information. For UPI payments, the transfer limit is currently Rs 1 lakh. Banks will charge its customers Rs 2.50-5 for each transaction, depending on the amount. The money will be transferred to the beneficiary account instantly.
How to Use UPI for Money Transfer & Bank Payments?
- Create your virtual payment address for your bank account with the bank using their banking mobile app or Internet banking.
- Add the accounts to be associated with the UPI address and also select a default bank account for sending and receiving payments.
- Now, send and receive payments using UPI via bank mobile app.. To receive money, you just need to share your virtual payment address, which can be as easy as yourname@bankname. The person who needs to pay you can use this virtual address to send you money easily via UPI.