Upi Project

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This is to certify that DAKSH AGGARWAL of

BSc. (Hons.) Mathematics has successfully


completed his project on topic UPI under the
supervision of Mrs Meenakshi Meena during the
academic year 2023-24.
INTRODUCTION
Nowadays, the world is undergoing digitalization in every aspect, and one
notable example of this is the increasing number of countries transitioning
towards a cashless society. A cashless society refers to a society where cash is
not used for any transactions, and instead, all transactions are conducted
digitally. Numerous countries around the world have more than 50% of their
transactions carried out through cashless methods.

WHAT IS DIGITAL PAYMENT?


Digital payment refers to the purchase of goods or services using various
electronic modes of payment, eliminating the need for physical cash or checks.
The popularity of digital payments has grown significantly in recent times due
to their ease and convenience. Additionally, digital payment methods offer
customers the flexibility to make payments from anywhere at any time, serving
as a viable alternative to traditional payment methods and expediting
transaction processes.
Types of Digital Payment methods in India :-
1. Banking Cards- Debit/Credit / Prepaid Cards.
2. AEPS (Aadhar Enabled Payment System).
3. UPI Mobile (Unified Payments Interface).
4. Mobile Wallets.
5. Bank Pre-paid Cards.
6. POS Terminals.
7. Internet Banking.
8. Mobile Banking.
9. BHIM App (Bharat Interface for Money)

The Digital India program is a flagship agenda of the Government of India with vision to
transform India into a digitally empowered society and a knowledge economy. “Faceless,
Paperless, Cashless is one of the professed role of Digital India. It is created to deploy
various digital services across the country, it is necessary to create a strong digital
infrastructure.
UPI
Background
Prior to 2016, India used a number of different systems to transfer money between
banks. The traditional forms included RTGS, IMPS and NEFT. With the plethora of
systems, rules and growing paper burden, there was a need for a unified system that
could automate and standardise India’s payment platforms. In 2016, NPCI set out
with a mandate to change the face of India’s payment systems. It developed the
Unified Payments Interface (UPI) as an architecture framework with a set of standard
Application Programming Interface (API) specifications to facilitate online payments.
The aim was to simplify and provide a single interface across all NPCI systems,
thereby creating interoperability and a superior customer experience. The pilot
program, with 21 member banks, was launched on 11th April, 2016, by Dr.Raghuram
G. Rajan, Governor, RBI, in Mumbai. From 25th August, 2016, a growing number of
banks started to upload their UPI enabled apps to the Google Play store.

Introduction
The Unified Payments Interface (UPI) is a revolutionary, user-friendly, real time
payment solution that facilitates inter-bank transactions, and enables greater digital
payments adoption in the country. Developed and launched by the National
Payments Corporation of India (NPCI)—a Reserve Bank of India regulated
organisation—launched the United Payment Interface (UPI) payment system in India
in 2016. UPI is a smartphone based feature that facilitate easy and instant inter-bank
fund transfer. The key highlight of the UPI that a single mobile application can be
easily used to access different bank accounts. It uses the unique virtual ID provided
by banks, also known as Virtual Payment Address (VPA) for all digital transactions,
including payments and funds transfer. The UPI uses the existing Immediate
Payment Service (IMPS) infrastructure—used by net banking—for instant transfer of
funds.
UPI’s core function is to support easy and secure money transfers between bank
accounts. It does this by adding multiple bank accounts into a single mobile
application, allowing for seamless fund transfers and merchant payments from one
place. It also enables ‘peer to peer’ and ‘peer to merchant’ collection requests, which
can be scheduled and paid as requested.
Payments can be made using a UPI ID, UPI Number, Account number, and an Indian
Financial System Code (IFSC). Payment security is as per applicable RBI guidelines
using a 1-click 2-factor authentication where the second factor of authentication is
the UPI PIN. UPI is also available through the Unstructured Supplementary Services
Data (USSD) channel to enable UPI members to cater to users of feature phones.
How To Register in UPI.
To use UPI as a payment mode, one has to sign-up for the service through a UPI
app. This can be done on mobile banking of your particular bank or a third-party
UPI app. Steps are
1. You need to have a smartphone and internet facility to use it.
2. User downloads the UPI application from the App Store/Banks website.
3. Scroll to the ‘Bank Account’ section on the app. This section shows all the bank
accounts linked with this particular app.
4. Select the bank account for which you want to set a UPI PIN. You will see a ‘SET’
option in case you have never set a UPI PIN for the bank account
5. Enter the ‘Last six digits’ and ‘Expiry date’ of your Debit/ATM card
6. Now, you will receive an OTP from your bank on the registered mobile number. In
the next screen, enter the OTP and the UPI PIN you want to set for the account
and click ‘submit’
7. You will receive a congratulatory message on the successful generation of UPI PIN.
After this, you can send money, make payments from your bank account directly by
authenticating using your UPI PIN.

How To Find UPI ID


To find your UPI ID, you need to follow the steps mentioned below:

 Open your UPI app


 Tap on your photo in the profile section
 Tap on the bank account
 Tap the bank account whose UPI ID you want to view
 You will find the associated UPI ID under ‘Manage UPI ID’s section

Transfer Money through UPI


 Open the UPI-based app where you have registered on your smartphone.
 Log in to the app using the m-PIN or UPI PIN
 Select the “Transfer/Send Money” option
 Enter the beneficiary’s VPA/account details/mobile number
 Enter the amount to be transferred
 Enter the UPI PIN to confirm the payment
 Money is transferred instantly and a confirmation message is sent to the user’s
mobile number.
Request Money through UPI
 Open the UPI-based app where you have registered on your smartphone
 Log in to the app using the m-PIN or UPI PIN
 Select the “Request Money” option
 Enter the payee’s VPA/Select the payee’s VPA from the existing list
 Enter your UPI PIN to generate a request
 A payment request will be sent directly to the payee
 The payee can make the payment directly by clicking “Approve” and entering
his UPI PIN
 Users can also split bills using the BHIM app

Bill Payment through UPI


 Once logged in to your UPI-based app, select the option “Bill Payment”
 You will have to add a biller to avail this service
 Enter the amount that you have to pay the bill for
 Enter the UPI PIN to make the transaction
 Your payment will be credited to the biller instantly
 You can pay bills for mobile post-paid, water, electricity, DTH, broadband, gas,
etc.

How to Reset Your UPI PIN


In case you forgot the UPI PIN, follow the steps mentioned below to reset UPI PIN:

 Go to your UPI app


 Tap on your photo in the top-right section
 Tap on the bank account under payment methods
 Tap on the bank account you want to edit
 Tap on the ‘Forgot UPI PIN’ option
 Enter the last 6 digits of your debit card and the expiry date (MM/YY)
 You can create a new UPI PIN
 An SMS will be sent on your registered number for OTP authentication
Benefits Of Using UPI
A. For Users
 Highly secure as no account detail is shared
 VPA ensures no personal details are shared with others
 Round the clock transaction facility
 Easy to use
 The transfer can be made instantly
 All bank accounts can be managed through a single app
 Single click authentication
 Money can be requested from the payee through the app
 Complaints can be raised directly as well

B. For Banks
 A safe and secure transaction system
 Seamless merchant transaction
 Use of the existing infrastructure ensures no additional cost is incurred by the
bank
 Single-click with two-factor authentication

C. For Merchants
 Seamless fund collection
 Instant receipt of fund
 No need for sharing bank details
 No additional or operating cost as opposed to PoS machines
 Suitable for e-commerce platforms
 COD collection made easy with UPI payment
Participants in UPI

 Payer PSP
Member bank as a Payer PSP can onboard a customer into a UPI app, allowing the
customer to register for UPI services and provide options to approve a financial
transaction or non-financial request wherever necessary

 Payee PSP
A bank in the role of Payee PSP can onboard a customer/merchant to receive money
or raise a collect request. This is also known as a beneficiary/resolving PSP.

 Remitter Bank
All UPI users need to have a banking account with a UPI enabled bank. While
performing a transaction, the user’s bank account will be debited. The remitting bank
also holds the responsibility of authenticating the UPI PIN set by the customer.

 Beneficiary Bank
Any credit going to a UPI user will be credited to a beneficiary’s bank account. The
bank receiving the funds in UPI transactions will be acting as a beneficiary bank.

 NPCI
NPCI is the owner, network operator, service provider, and coordinator of the UPI
Network.

 Bank Account holders


Any customer who is on-boarded by a bank with a UPI enabled account and a UPI ID
can utilise the services.

 Merchants
Participating merchants are those who are on-boarded by their banks to
accept UPI enabled payments from customers
UPI APPS
WHAT IS A DIGITAL WALLET?
An electronic device or online service that allows an individual to make electronic transactions is called a digital
wallet. An individual`s bank account can also be linked to the digital wallet. One in five customers in Asia are now
using a digital wallet. Some of the popular digital wallets are Paytm, Freecharge, Mobikwik, Oxigen, mRuppee,
Airtel Money, Jio Money, SBI Buddy, itz Cash, Citrus Pay, Vodafone M-Pesa, Axis Bank Lime, ICICI Pockets,
SpeedPay, PhonePe, etc.

A. Paytm - It is an Indian e-commerce operator and Financial Technology company. Paytm was founded in
August 2010 by its founder Mr. Vijay Shekhar Sharma. In 2014, the company launched its first Digital E-wallet
known as Paytm Wallet. Paytm offers Digital wallet payment, mobile payments, online shopping, Paytm
Payments Bank etc.
Paytm is known as a digital payment system which allows you to transfer money through your debit/credit
cards and which also allows you to do online banking. Once you register to Paytm you can make online
payment of bills or you can make payment through you paytm wallet by first adding money into your
wallet

B. Google Pay - It also known as G Pay or Pay with Google it is also one type of Digital Wallet and online
payment system developed by Google. The services of Android Pay and Google wallet merged in January
2018 and the name was changed to Google Pay. On September 2017, Google launched an UPI-based app
known as TEZ in India which was later rebranded as Google Pay. Google pay has more than 25 million active
users in a month of the digital wallets in India.

C. PhonePe - It is an Indian e-commerce payment service and digital wallet company. It was founded in the
year 2015 by its founders, Mr. Sameer Nigam and Rahul Chari and it was the first payment app in India which
was built on Unified Payments Interface i.e (UPI). It offers various services such as:- i. User can send or
receive money through Phone Pe app.
ii. User can make various payment- mobile recharges, DTH recharges, users
can also make payments of shopping online on various apps.
iii. Phone Pe even allows users to book tickets through various apps.
Phone Pe app has more than 100 million users and it has crossed more than 5 billion transactions.

D. Mobikwik - MobiKwik is also another Indian company app which acts as a digital wallet, as a mobile
payments system and was founded by Bipin Singh and Upasana Taku in the year 2009. Initially it was just a
website with closed wallet facility but later started with mobile apps. In the year 2016 it launched -Mobikwik
Lite app which was for older 2G mobile networks and those with poor network connectivity. It has also
launched its first ever Mobile Wallet system in the year 2012.

E. YONO by SBI - The word YONO means You Only Need One, this app helps users to access various
financial and other services, it acts as a Digital Banking platform which offers various services such as online
shopping payments, booking tickets of (train, bus, taxi, flights), it also allows customers to make medical bill
payments. YONO app was launched in the year 2017 by Mr. Arun Jaitley, the then Finance Minister of India.
This app can also be used by customers to make ATM withdrawals as well as this app can be used to make
various fund transfers, etc. Through YONO app a customer can track his/her OD account balance, can even
open fixed deposit, recurring deposits, and can even invest in mutual funds. Customers can even track their
loans through this app.
ADVANTAGES OF UPI
Here are some of the best benefits of using UPI

1. Secure payment

The first advantage of UPI payment is security. You can perform the safest transaction possible by
using the Unified Payments Interface (UPI) without ever disclosing your UPI PIN. This method of
transferring funds is extremely secure because it only requires you to remember one PIN.

2. 24 x 7 availability

With UPI, mobile phone users may send and receive money instantly. 24X7.

3. Convenience

The ease of use is one of the most appealing features of UPI for consumers. Only with a few clicks,
a transaction can be finalized in a matter of seconds. You can forget about bringing cash with you or
making a trip to the bank.

4. Zero charges

All UPI payments are free of charge and you can conduct monetary transactions at no cost. Whereas
similar payments made through IMPS or NEFT incur a small fee, UPI transactions are tax-free. You
can conduct monetary transactions at no cost to you.

5. Simple interface

With the assistance of the UPI payment, sending money to another person’s bank account is a
breeze. To send money to another UPI user, all you need is their UPI id, which you can get by
asking them for their UPI pin, and the amount, both of which you may enter into the UPI support
app.

6. Real time payment

The major benefit of the UPI is that you can send or request any payment at once. In a matter of
seconds, the funds will be deposited into your account or transferred to another.

7. Supports maximum bank

Almost every financial institution can work with UPI. SBI, PNB and any other bank that supports
the Unified Payments Interface can receive payments quickly, simply, and at no cost.

8. Coupon and cash back offers


There are many advantages to using the UPI to send money to the other account holder, including
the possibility of receiving cash back. The UPI-supporting app, like Google Free Recharge for
Android or iOS, or any other UPI-supporting app offers cash back or rewards on transferring funds
or making a payment to any vendor through the UPI app.
Disadvantages of UPI

The UPI payment is straightforward and accurate, but it does come with a few drawbacks that we
have detailed below for your information.

1. Network connectivity issues:


The UPI support app must be installed on your smart phone and only then can be used to
make payments. There is no web browser access available for this app. UPI transactions are
heavily dependent on internet connectivity. In areas with poor network coverage or weak
internet signal, UPI transactions may fail or take a long time to complete. This can be
inconvenient for users who rely on UPI for everyday transactions

2. Dependency on smartphones

In order to complete a UPI transaction, the user must have access to both a smart phone and the
internet. This can be problematic for those who do not have access to smart phones or the internet.
Furthermore, customers may experience issues using their UPI accounts & completing transactions
if they lose or damage their phones.

3. Server issue

While UPI is a speedy and secure method of payment, it can take a while to process after a server
outage at the receiving bank.

Like any other software, UPI systems might have downtime or technical issues. Online customers
may become irritated if tech maintenance is performed without warning or during peak shopping
hours.

5. Online fraud

Cyber criminals are adapting to the growing trend of individuals making and preferring online
payments over more conventional ones.

More and more people fall victim to identity theft, phishing scams, and database breaches.
Businesses spend a lot of money on payment-security software to protect themselves from these
threats and boost security.

Thus, never share your UPI pin with anyone, this can keep you secure and protect against online
fraud.
6. Technological illiteracy

The fact that many people, particularly the elderly, are technologically illiterate is a major drawback
to UPI online payment systems. They don’t feel confident making purchases online due to a lack of
understanding on how to use technology or devices.

Many people avoid using electronic payment systems because they find them too complicated. This
is particularly problematic in economies in transition, such as India’s.
What Is the Maximum Limit of UPI Transaction?

As of 2023, the maximum limit of transactions across all UPI applications is


1,00,000 Rs /per day. In addition, you can’t send money more than 10 times a
day. Further, you will reach a daily maximum limit if you request someone more
than ₹ 2000 in a day.

Objectives of Launching UPI AutoPay

 Making recurring payments accessible and easy


 Better and newer features for increasing the proportion of digital
payments and reducing the amount of cash that we use in our economy
 Introducing a convenient and safe option for UPI users for their recurring
payments
 It is to reduce the costs and risks of handling cash, increase the ease of
conducting online transactions, and increase transparency among monetary
transactions among people.

UPI Lite

Users can do low-value transactions through UPI Lite. This service allows
customers to make transactions below Rs. 200. You can simply activate UPI Lite
wallet in your UPI app namely BHIM, Paytm, PhonePe, etc. Customers can easily
make payments from this wallet and it requires just one click. Users do not
require to authenticate their transaction with UPI PIN in this facility. The service
will reduce the load from the core banking system, thereby, making UPI
transactions faster.

Why is a cashless society good?


Cashless payments eliminate several business risks such as theft of cash,
counterfeiting money, and robbery of cash. Moreover, it also reduces costs of
security, and it allows you to buy whatever you want and whenever you want
without the need of withdrawing cash.
Need For the Study

UPI is an abstraction over standard payment transfer mechanism


like IMPS, it helps to hide sensitive account information along
with consumer convenient. Also, UPI is Fast and does not
involve the costs like debit card or net banking. By using
Statistics government and other bodies the study will approach to
understand, discuss and bring out the issue relevant to the title.
Financial transactions are the backbone of any economy in the
world. In India cash was always the king. i.e., all the transactions
in our country used to take place through the means of cash only.
Nearly four of every five transactions used to take place through
cash means during the year 2015, cash was the predominant
mode of payment and was the base of our economy and this was
because of digital illiteracy, lack of education, lack of
infrastructure, low network connections in remote areas of our
country and many more reasons. The transaction process has
become more convenient, secure and transparent in nature with
the help of such Digital modes of Payment. If cashless
transactions is adopted and implemented in India then it will be
easier to exchange currency while travelling to abroad countries.
A cashless society leads to lower crime rates which is an
advantage to the society. There will be no scenario of black
money and can stop corruption once a society is cashless in
economy and this can be done by adopting more and more
digital mode of payment for various transactions. The main
purpose of the study is to investigate the benefits of using
online payment applications and to analyse the How UPI made
India Digitalised. The main agenda of this study is to find out the
impact of using UPI and to find out that using UPI as a payment
method has helped the customers or not.
Scope for the Study

UPI is a digital payment system backed by NPCI and RBI that


allows instant interbank fund transfers via mobile app without
having to enter bank details or add a beneficiary. It has played a
crucial role in India's move towards a cashless economy by
providing a secure digital wallet for easy bill and merchant
payments. To know how consumers adapted to modern kind of
payment method and made India digitalized.

Significance for the study

Due to various reasons UPI Payments have become an


important kind of transaction in trade. By this study we are
trying to find out what are the various modes of online payment
terms related to UPI. This study is to analyse the awareness and
satisfaction level of the customers using UPI and the security
and privacy concerns influencing consumers in adoption of UPI.
The study analyses the consumer perception and problems
towards UPI. It also helps to identify the variance between UPI
services and traditional services and How UPI payments plays
pivotal role in today’s transactions.
TOTAL AMOUNT OF TRANSACTION IN UPI

No. of Banks Volume (in


Month Value (in Cr.)
live on UPI Mn)

Oct'23 505 11,408.79 17,15,768.34

Sep'23 492 10,555.69 15,79,133.18

Aug-23 484 10,586.02 15,76,536.56

Jul-23 473 9,964.61 15,33,645.20

Jun-23 458 9,335.06 14,75,464.27

May-23 445 9,415.19 14,89,145.50

Apr-23 414 8,898.14 14,07,007.55

Mar-23 399 8,685.30 14,10,443.01

Feb-23 390 7,534.76 12,35,846.62

Jan-23 385 8,036.89 12,98,726.62


Which Countries Have Adopted UPI?
Over the past seven years since UPI’s launch, UPI payment systems have been
accepted in over ten countries worldwide.

Here’s a list of all the countries that have adopted UPI to date:

Country Accepted

Bhutan July 2021

Oman March 2022

The United Arab Emirates April 2022

Malaysia 2021

The United Kingdom August 2022

Singapore February 2023

Europe October 2022

Bahrain –

France July 2023

Conclusion
In general, UPI has changed the way of money transfer in India
by making it safer and cheaper than previous approaches. The
use of UPI has many advantages as mentioned above.

Nevertheless, not all payment options are created equal, and


you’ll want to weigh the pros and downsides before settling on
one. Consumers may make more well-informed selections about
which payment method is ideal for them if they are aware of the
benefits and drawbacks of UPI for payments.

UPI Payments are changing the way we send and receive money,
reducing dependence on bank systems. It has simplified
transactions, made them more secure, and made them easier.
Using NCPI’s UPI, you can make hassle-free, cashless
payments, and it’s relatively simple.

If you regularly use your online banking facility, you may find
the UPI application useful for sending and receiving money
online.
BIBLIOGRAPHY

A. Google.com
B. Demandsage
C. Easebuzz
D. PaisaBazzar
E. NPCI.org
F. Academic.eud
G. Linkedin

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