UPI ADVANCEMENT

TEAM MEMBERS
• SHAGUN SAHANI – 47
• KHUSHI MEHTA – 27
• DEV SHAH – 58
• SARVESH SALASKAR - 48

PRINCIPAL AUTHOR : FALGUNI MATHEWS

INDEX
 INTRODUCTION

A Unified PaymentInterface (UPI) is a smartphone application that allows users to

transfer money between bank accounts. It is a single-window mobile payment
systemdeveloped by the National Payments Corporation of India (NPCI). It eliminatesthe
need to enter bank details or other sensitiveinformation each time a customer initiates a
transaction.

It is designedto enable peer-to-peer inter- bank transfersthrough a single two-click factor

authentication process.The interface is regulated by the Reserve Bank of India (RBI),
India's centralbank. It works by transferring money between two bank accounts along
with a mobile platform.

WORKING OF UNIFIED PAYMENTS INTERFACE

(UPI)

UPI uses existing systems, such as Immediate Payment Service (IMPS) and Aadhaar
Enabled Payment System (AEPS), to ensure seamless settlement across accounts. It
facilitates push (pay) and pull (receive)transactions and even works for over-the- counter
or barcode payments, as well as for multiplerecurring payments such asutility bills,
school fees, andother subscriptions.

Once a single identifier is established, the system allows mobile payments to be delivered
without the use of credit ordebit cards, net banking, or any need to enter account details.
This would not just ensure greater safety of sensitiveinformation, but connect people who
have bank accounts via smartphones to carry out hassle-free transactions.

Overall, UPI implies fewer cash transactions and potentially reduces the unbanked
population.

SENDING MONEY VS. RECEIVING MONEY

Sending money on the UPI is called a "push." In order to send money, the user logs into
the interfaceand selects the Send Money/Payment option. After enteringthe recipient's
virtual ID and the amount desired, he chooses the account from which the money will be
debited. The user then enters a special personal identification number (PIN) and receives
a confirmation.
Receiving money through the systemis called a "pull." Once the user has logged in to the
system, she selects the option to collect money. A message then goes to the payer with
the request to pay. If he decides to make the payment, he entershis UPI PIN to
authorizethe transaction.

Once the transfer has been completed, both the sender and the recipient receive a
confirmation by text messageto their smartphones.
 LITERATURE REVIEW

ARTICLE 1:

HTTPS://WWW.FORTUNEINDIA.COM/ENTERPRISE/HOW-UPI-IS-MAKING-INDIAS-
DIGITAL-ECONOMY-BOOM/105433

LITERATURE REVIEW

In the pandemic when social distancing is the most critical norm, the unified payments
interface (upi) is like a godsend. the instant real-time payment system has turned out to
be the best financial innovation post- independence in india and has begun in earnest the
process of replacing the cash economy altogether.it has contributed its might to make the
country one of the fastest growing digital economies in the world.

According to the latest data compiled by the national payments corporation of india
(npci), which manages upi, it has reported a threefold increase during the last fiscal
(2020-21) in both the number of transactions and the value. as of march 2021, the total
volume has jumped to 2,732 million transactions, worth ₹5,04,886 crore. at the beginning
of the fiscal, in april 2020, the total volume stood at 999.6 million with the total value of
transactions at ₹1,51,141 crore. the number of banks that are live on upi has gone up to
216 from 153 in april 2020. when the platform began operations in april 2016, there were
only 21 banks on board.

The two leading players—Walmart-owned PhonePe and Google Pay—have

continued to dominate the UPI ecosystem. PhonePe has topped the chart with 43.9% of
the total UPI transactions volume, accounting for 1,199.51 million transactions, with a
value worth ₹2,31,412 crore. In contrast, Google Pay has mopped up a 35% market
share in March, with 957.01 million transactions worth ₹2,01,185 crore. The third largest
Splayer, Paytm Payments Bank, posted 401.16 million transactions worth ₹43,221 crore.

ANALYSIS

UPI has played an integral part in making Banking and Financial transactions
seamless and easy to execute in the new Digital India.
All retail stores as well as small and large businesses have adopted UPI and
companies like BharatPe and PhonePe have been at the forefront of the new
UPI revolution.UPI has promoted ease of business through its seamless and
easy to use payments interface.
The transaction time that used to be a few days has now radically dropped down to a few
seconds due to UPI. Because of Lockdown every single household was able to make
contactless payments for everything right from their daily essentials like groceries to
electronics and other luxury purchases. UPI has become a notable innovation Financial
Technology and is an example of leading innovation for the entire world.

Article 2 :

https://www.thehindubusinessline.com/money-and-banking/phonepe-launches-upi-
based- autopay-functionality-for-mutual-fund-sip-investments/article35677906.ece

UPI-based AutoPay functionality for mutual fund SIP investments Literature

Review

Fund houses such as Aditya Birla Sun Life Asset Management Co. Ltd, Baroda
Pioneer Asset Management Co. Ltd and DFC Asset Management Co. Ltd and distributors
such as Funds India allow you to invest in mutual funds using unified payments interface
(UPI). So, along with payment options such as net banking and national electronic funds
transfer (NEFT), you can use UPI as well.

To use UPI, you need to have a bank account with a UPI-enabled member bank and a
registered mobile number linked to your bank account. You need to have a virtual ID that
looks similar to your email ID— name@bankname.

ANALYSIS

Traditionally, investing in Mutual Funds was a complicated affair and it required a lot of
manual submission of documents and financial data. Due to advancement in Banking,
NEFT was introduced but it still took more than a day to process.

Further, after introduction of UPI, investing in mutual funds has now become fairly simple
and the transaction time has reduced drastically and is now almost instant.

The Auto pay feature and Auto debit feature helps to make individuals more disciplined
as it helps automatically investing at regular intervals helping individuals maintain
investing habits with the least effort.
ARTICLE 3

UPI CLOCKS 1.3 BILLION TRANSACTIONS IN DECEMBER

Livemint Published on 4th January 2020

The transactions were worth ₹2.02 trillion in December compared to ₹1.89 trillion a
month ago. Currently, 143 banks are live on UPI. UPI allows users to transfer money any
time, on a real-time basis, across multiple bank accounts, without revealing details of
one’s bank account to the other party.

The simple, hassle-0free three-year old payment system is popular among the masses.
Besides, the government has been introducing steps to popularise digital payments via
UPI. For instance, businesses with more than ₹50 crore sales will have to compulsorily
offer electronic payment modes such as debit cards powered by RuPay and low cost
digital payments options such as UPI from 1 January 2020. All companies with a turnover
of ₹50 crore or more shall be mandated to provide the facility of payment through RuPay
Debit card and UPI QR code to their customers," the finance ministry had said.

National Payments Corporation of India had reported that 39% of the transactions made
through UPI are done through Yes Bank

ANALYSIS :

1. We can see that the number of transactions via real-time payments system Unified
Payments

2. Interface (UPI) continued to rise, clocking 1.3 billion transactions in December,

National Payments Corporation of India (NPCI) data showed.

3. These transactions were 7% higher than in October, and 111% higher on a

year-on-year basis, the data showed.

4. This is due to the wide acceptance and adoption of UPI payment systems at all
levels. Everyone, right from the consumers at the base level, to the manufacturers,
retailers and merchants have adopted UPI payments.

5. This is due to the various benefits of UPI like its low cost, which makes it very
affordable, and since its an instant payment system, it saves a lot of time.
 ARTICLE 4:

UPI TRANSACTIONS DROP IN MARCH, RTGS SHOOTS UP DUE TO

CORONAVIRUS LOCKDOWN

NEWS 18

PUBLISHED ON APRIL 21, 2020

Unified Payments Interface (UPI) is an instant payment system developed by the

National Payments Corporation of India (NPCI), an RBI regulated entity.
The value of UPI transactions too came down to Rs 2.06 lakh crore during March,
from Rs 2.23 lakh crore in February. The number and value of transactions
through the UPI had been constantly growing, barring marginal decline in some
months.

The 21-lockdown imposed by the government with effect from March 25 to fight
coronavirus seems to have adversely impacted the transactions through UPI.
The NPCI data on IMPS (Immediate Payment Service) revealed the number of
transactions fell to 21.68 crore in March from 24.78 crore in the previous
month. There was also a decline in the value of transactions during March to Rs
2.01 lakh crore from 2.14 lakh crore in February.

The 24X7 IMPS empowers customers to transfer money instantly through banks
and RBI authorised Prepaid Payment Instrument Issuers (PPI) across India
through mobile phone, internet banking and ATM.

Meanwhile, an RBI data revealed that value of Real Time Gross Settlement (RTGS)
transactions shot up to Rs 120.47 lakh crore in March, up 34 per cent over
February. The total value of RTGS transactions in February was 89.9 lakh crore.

ANALYSIS :

AFTER CONSTANTLY RISING FOR THE PAST SEVERAL MONTHS, THE VOLUME, AS
WELL AS VALUE, OF TRANSACTIONS THROUGH UPI PAYMENT SYSTEM DROPPED
IN MARCH DUE TO THE 21-DAY NATIONWIDE LOCKDOWN IMPOSED TO COMBAT
THE CORONAVIRUS INFECTION.
OBJECTIVES OF THE STUDY

THE MAIN OBJECTIVES OF THIS STUDY ARE:

1. TO UNDERSTAND THE UPI MECHANISM AND IT’S WORKING.

2. TO UNDERSTAND IT’S IMPACT ON DAILY TRANSACTIONS MADE BY
INDIVIDUALS IN INDIA.
3. TO UNDERSTAND HOW UPI HAS CHANGED FINANCIAL BEHAVIOUR OF
SELLERS AND BUYERS.
4. TO UNDERSTAND THE IMPACT UPI HAS BROUGHT IN A DIGITAL
REVOLUTION IN THE BANKING SECTOR IN INDIA.
5. TO FIND OUT THE PROS AND CONS OF USING UPI.
6. TO UNDERSTAND HOW LOCKDOWNS AND COVID PREVENTIVE MEASURES
SUBLIMINALLY PROMOTED UPI.
7. TO IDENTIFY THE VARIANCE BETWEEN UPI SERVICES AND TRADITIONAL SERVICES.

SELECTION OF PROBLEM

THIS PROJECT AIMS AT UNDERTAKING A COMPREHENSIVE STUDY ON HOW UPI IS

CHANGING CONSUMER BEHAVIOR AND HOW INTRODUCTION OF UPI HAS MADE
ACCOUNTING SIMPLER, AND HOW UPI HAS PROMOTED DIGITAL BANKING IN A
MASSIVE WAY.

SCOPE OF THE STUDY

• The scope of research extends to understand the impact of UPI on

individuals and institutions through a detailed survey.

To understand how UPI has made online and offline payments more convenient
for customers as well as the businesses.

• To understand the impact of UPI on banking and Fintech.

• To study the advantages that UPI has and how it has changed the thinking
of individuals with respect to money.

• To understand the disadvantag

 LIMITATIONS

The sample size was limited to 100 respondents.

The sample was taken from the population residing in India only. The results
are not applicable to the whole world.
The paucity of time and resources was a major constraint.
My research is biased towards citizens in the metropolitan and urban region
and not the rural areas.
The class of people is limited as it does not include people from the lower income
level.
The limited knowledge of the respondents

RESEARCH METHODOLOGY

This research paper is based on a combination of primary and secondary data

which we have collected from a wide variety of sources. Primary data has been
collected with the help of a self-designed questionnaire and interview method,
which was conducted within the confines of Mumbai city itself. Secondary data
was collected from various news articles, blogs, websites etc.

DATA ANALYSIS
PRIMARY DATA

DATA ANALYSIS AND INTERPRETATION OF

QUESTIONNAIRE QUESTION 1: AGE GROUP

ANALYSIS:
MOST OF THE RESPONDENTS WHO
WERE SURVEYED ARE IN THE AGE
GROUP OF 21-30 YEARS (36%),
FOLLOWED BY RESPONDENTS IN THE
AGE GROUP OF 18-20 YEARS (26%),
THEN 31-40 (20%) , FOLLOWED BY
41-50 (11%)
AND ABOVE 50 (7%).
QUESTION 2: GENDER
ANALYSIS :
100 people were asked to fill the
questionnaire, out of which majority were
males (59.2%) and about (40.8%) were
males. There isn’t a vast difference in the
gender of the respondents.

QUESTION 3 : OCCUPATION ANALYSIS:

• 25% of all the individuals are
self- employed, involved in business
activities
• 31% of all individuals surveyed
are salaried or employees or companies.
• 4% of the individuals surveyed
are retired and do not earn any income.
• 13% of the individuals surveyed
are homemakers, who do not earn any
income.
• 27% of the individuals surveyed
are students, who do not earn any
income.

QUESTION 4: DO YOU USE UPI TO MAKE PAYMENTS ?

ANALYSIS:
From the above table and graph, it can be
inferred that:
• A vast majority of people, i.e.,
79% use UPI to make payments.
• While a small minority of people,
i.e., 21% people do not use UPI to make
payments.

QUESTION 5: WHICH OF THESE UPI APPS DO YOU USE?

ANALYSIS:
• More than half of the people
surveyed(55%) people prefer to use
GooglePay to make their UPI payments
• Followed by GooglePay, is Paytm-
with 45% people using it to make their
UPI payments
• Apart from that, PhonePe(34%),
AmazonPay(26%), MobiKwik(17%) are
used by people to make their payments.
The chart below gives a visual representation of the app
preferences of various people surveyed:
QUESTION 6: SINCE HOW LONG HAVE YOU BEEN USING UPI?

ANALYSIS:
• We can see that a good number
of people have adopted UPI payments
and have started using it to make
payments in the last one year. (65%)
• Out of that, 21 percent have
started using UPI in the last 6 months,
and 44% people have been using it for
more than 6 months.
• 44% people of the total
surveyed have been early adapters,
and are using UPI since more than a
year.

QUESTION 7: HOW DID YOU GET TO KNOW ABOUT UPI?

ANALYSIS:
• There are 44% people who got
to know about UPI because of their
friends and relatives. This majorly is
because of the referral policy of various
UPI apps.
• 26% of the total surveyed have
been informed about UPI services by
the bank staff.
• Advertisement has helped 26%
people to get to know about and start
using UPI.

QUESTION 8: HOW OFTEN DO YOU USE UPI TO MAKE PAYMENTS?

ANALYSIS:
• UPI has been an integral part of
the daily lives of 48% people. These
people use UPI very often to make
payments.
• UPI is used less often by 35%
of the people.
• Lastly, there are 13% people
who rarely use UPI and only 4% people
never use UPI.
QUESTION 9: ARE UPI AND DIGITAL PAYMENTS ARE BEING WIDELY
ACCEPTED AT ALL MERCHANT STORES NOW?

ANALYSIS:
• Among the total people
surveyed, 76% people feel that
UPI and digital payments are
being widely accepted at all
merchant stores now. While,
24% people feel that UPI and
digital payments are not widely
accepted at merchant stores.

QUESTION 10: DO YOU CARRY MORE CASH, OR PREFER TO HAVE BALANCE TO

USE UPI FOR PAYMENTS?

ANALYSIS:
• We can see that more than
half of the people(54%) still
prefer to carry more cash for
payments than usng UPI.
• While 46% of the people
now prefer to have more UPI
balance to make payments.

QUESTION 11: WHICH DIGITAL PAYMENT METHOD DO YOU FIND EASIEST TO USE?

Analysis:
• 45% of the people feel
that GooglePay is the easiest app
to use.
• Nearly 23% people feel
that MobiKwik is the easiest to
use.
• Followed by that are,
PhonePe and AmazonPay with
19% and 13% people voting for
them respectively.
QUESTION 12: WHICH OF THE FOLLOWING THINGS HAVE YOU USED UPI
PAYMENTS FOR?

ANALYSIS:
The above graph aims to
understand the various purposes
people use UPI for:
• We can see that half of the
people (50%) use UPI payments
to make their bill payments.
• Apart from that, 46%
people use UPI to make merchant
payments.
• Lastly, 43% people use
UPI payments to make P2P
transfers and nearly 40% people
use UPI to do Recharge.

QUESTION 13: WHAT PROBLEMS DO YOU FACE WHILE USING UPI?

ANALYSIS:
• We can see that 48%
people face network problems
while using UPI.
• 39% of the total people
have authentication problems
while using UPI.
• Lastly, around 36% and
28% people face Safety and
Security and Pending for
Verification error respectively
while using UPI.

QUESTION 14: ON A SCALE OF 1 TO 5 (1= LOW, 5= HIGH/SAME LEVEL OF ACCEPTANCE AS CASH), HOW
MUCH ARE UPI PAYMENT METHODS ACCEPTED BY MERCHANTS?

ANALYSIS:
• We can see that,
according to a vast majority of
people, i.e., 74% people, UPI is
readily accepted by the
merchants in the same way as
cash.
• While 22% of the people
have a neutral opinion about it.
• Only a minority percent of
the total surveyed people(4%)
feel that UPI is not readily
accepted by merchants.
 OBSERVATION & RECOMMENDATION

1.INTERVIEWS CAN BE CONDUCTED IN ORDER TO GAIN INSIGHT

ABOUT PERSONAL BELIEFS OF INDIVIDUALS.
2.KNOWLEDGE ABOUT THE INDIVIDUAL’S PERCEPTION OF THE
FUTURE OF UPI SHOULD ALSO BE TAKEN INTO CONSIDERATION IN
FURTHER RESEARCH PAPERS.
3.IT IS IMPORTANT TO CREATE AWARENESS AMONG INDIVIDUALS
WHO ARE NOT CURRENTLY USING UPI, IN ORDER TO EXPAND THE
UPI AND DIGITAL PAYMENTS AS A WHOLE.
4.AFTER ANALYSING THE RESPONSES GIVEN BY THE RESPONDENTS,
IT WAS OBSERVED THAT THE CUSTOMER SATISFACTION HAS
IMPROVED GREATLY DUE TO UPI.
5.DUE TO THE INCREASED SPENDING OF MONEY USING UPI AND AN
INCREASE IN FREQUENCY OF UPI PAYMENTS BY INDIVIDUALS, WE
CAN SEE THAT THERE IS A VARIANCE BETWEEN CUSTOMER
PERCEPTION TOWARDS UPI AND TRADITIONAL SERVICES,
HOLDING.
6.WE HAVE ALSO UNDERSTOOD HOW UPI HAS GREATLY IMPACTED
OUR DAILY LIVES AND HOW THERE HAS BEEN A BIG INCREASE IN
THE AMOUNT OF MONEY WE SPEND USING DIGITAL PAYMENTS.
7.WE HAVE UNDERSTOOD HOW UPI IS SAVING THE TRANSACTION
TIME AND IS A LOW-COST METHOD, THEREFORE PROVING TO BE
AN EFFICIENT PAYMENT GATEWAY FOR ALL OF US.
 CONCLUSION

• UPI IS A GREAT STEP TOWARDS MAKING THE CASHLESS PAYMENTS FASTER,

SMOOTHER AND EASIER. IT IS SAID THAT THE LAUNCH OF UPI WILL PROVE TO BE A
MILESTONE IN THE TRANSFORMATION OF MODERN INDIA.

• UPI IS ALL SET TO BECOME AN EFFICIENT ALTERNATIVE TO MOBILE WALLETS.

THE FUTURE OF UPI IS BRIGHT, AND AS WE CAN SEE; UPI HAS ALREADY BECOME THE
PREFERRED MODE OF PAYMENT FOR A VAST MAJORITY OF PEOPLE IN A VERY SHORT
SPAN OF TIME.

• UPI ACTS AS A STOREHOUSE AND LETS YOU ACCESS ALL YOUR BANK ACCOUNTS
USING A SINGLE APP. THIS MAKES THE ENTIRE PROCESS CONVENIENT. DUE TO THIS,
THE TOTAL TRANSACTIONS PER MONTH OF UPI HAVE BEEN INCREASING EVER SINCE IT
HAS BEEN LAUNCHED.

• APART FROM THAT, WE CAN SEE THAT MORE AND MORE PEOPLE HAVE STARTED
USING UPI DUE TO THEIR CASH BACK AND REFERRAL OFFERS WHICH HAS BEEN ANOTHER
GREAT FORCE WHICH HAS ADDED TO THE USER BASE OF UPI.

• GOING FORWARD, I FEEL THAT UPI WILL BE THE PREFERRED MODE OF PAYMENT
OF ALMOST ALL THE PEOPLE DUE TO ITS VARIOUS ADVANTAGES LIKE EASE OF USE,
REAL TIME PAYMENTS, LOW COST AND HIGH TRANSACTION SUCCESS RATE. UPI SEEMS
TO BE ONE OF THE TOP TECHNOLOGICAL INNOVATIONS OF THE DECADE.

• UPI HAS GREATLY IMPACTED THE BANKING INDUSTRY AND HAVE DISRUPTED THE
MARKET WITH ITS UNBELIEVABLE FEATURES. EARLIER, THE TRANSACTION TIME USED TO
BE A FEW DAYS, WHICH HAS NOW COME DOWN TO A FEW SECONDS BECAUSE OF UPI.
INVESTMENT HAS ALSO BECOME VERY SMOOTH DUE TO UPI AS THE NEED FOR
PAPERWORK TO ADD FUNDS HAS BEEN ELIMINATED. YOU CAN ADD FUNDS
IMMEDIATELY USING YOUR UPI ID.

• UPI HAS GREATLY HELPED THE MERCHANTS, MANUFACTURERS AND RETAILERS

AS ACCEPTING PAYMENTS HAS BECOME A VERY EASY PROCESS DUE TO THE
INNOVATION AND INTRODUCTION OF QR CODES.

• UPI HAS ALSO HELPED THE GOVERNMENT AS THE PAYMENTS ARE NOW
TRANSPARENT AND MADE THROUGH BANKS, INSTEAD OF CASH. THIS HAS BEEN OF
GREAT HELP TO THE GOVERNMENT AS IT HAS BECOME EASY TO TRACK THE USAGE
AND SPENDING OF PEOPLE.

SUMMING IT UP, WE CAN SEE THAT UPI HAS BROUGHT IN A BIG BEHAVIOURAL CHANGE
IN THE WAY WE SPEND, INVEST AND SAVE OUR MONEY AND ON OUR PREFERENCES OF
CHOOSING UPI AND DIGITAL PAYMENTS OVER THE USE OF CASH AND HENCE, WE CAN
SAY THAT UPI IS THE FUTURE OF PAYMENTS.
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