UPI - ECONOMY

News: UPI-PayNow linked to ease payments with Singapore

 

What's in the news?

       India’s Unified Payments Interface - better known as UPI and Singapore’s PayNow were officially connected, allowing for a “real-time payment linkage”.

 

Key takeaways:

       Singapore has now become the first country with which cross-border Person to Person (P2P) payment facilities have been launched.

       This will help the Indian diaspora in Singapore, especially migrant workers/students and bring the benefits of digitalization and FINTECH to the common man through instantaneous and low-cost transfer of money from Singapore to India and vice-versa.

       UPI payments through QR codes are already taking place in Singapore, though at a limited number of outlets.

 

Unified Payment Interface (UPI):

       It is a common platform through which a person can transfer money from his bank account to any other bank account in the country instantly using nothing but his/her UPI ID.

       It is developed by the National Payments Corporation of India (NPCI) under the guidelines of the RBI.

       The interface is based on the Immediate Payment Service (IMPS) platform.

       UPI is a payment system that allows money transfer between any two bank accounts by using a smartphone.

       UPI allows a customer to pay directly from a bank account to different merchants, both online and offline, without the hassle of typing credit card details, IFSC code, or net banking/wallet passwords.

       The UPI app merges a number of banking features, facilitating seamless and secure fund transfer and merchant payments at a single platform.

       It also allows Peer to Peer collection requests.

       Launched in 2016.

 

How will it work?

       A customer can transfer money to another person through a unique virtual address, or mobile number, or Aadhaar. Therefore, customers do not need to know the payee’s IFSC code, bank account details, etc. and this will make the process simpler.

       A customer can have multiple virtual addresses for multiple accounts in various banks. There is no account number mapper anywhere other than the customer’s own bank. This allows the customer to freely share the financial address with others.

 

 

Go back to basics:

National Payments Corporation of India (NPCI):

       NPCI is an umbrella organization for operating retail payments and settlement systems in India.

       It is an initiative of the Reserve Bank of India (RBI) and Indian Banks Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007 for creating a robust Payment and Settlement Infrastructure in India.