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Unified Payments Interface (UPI) - Introduction

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1) The Unified Payments Interface (UPI) allows for simple push and pull payments between banks using only a virtual address like a username. 2) Banks act as Payment Service Providers (PSPs) and provide a single app for all transactions via a single identifier like Aadhaar number with one-click two-factor authentication. 3) UPI provides benefits to end users like privacy by only sharing a virtual address, multiple uses for payments, remittances and bills, and availability 24/7 on personal devices with security.

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Unified Payments Interface (UPI)
Push and Pull Payments Virtual Address (Username@PSPName) Transfer using Single identifier like Aadhaar No Banks (Payment Service Provider) will provide App to customers of any bank One App for all transaction needs Single Click 2FA Unified Payments Interface
Participants PAYMENT SERVICE PROVIDER (PSP) PSPs will be banks who will provide Apps BANKS Merchant or customers bank (account relationship) NPCI provides UPI interface.
Benefits to Banks Simple (Single click 2FA) Universal App for transactions Leverages existing Infrastructure Secure Payments basis Single/Unique Identifier Tap C2B segment & E-Com / M-Com
Benefits to Merchants Seamless fund collection from customers - single identifiers No risk of storing customers virtual address like in Cards Tap customers not having credit/debit cards Suitable for e-Com & m- Com/ Resolves the COD collection problem Single click 2FA facility to the customer - seamless Pull In-App Payments (IAP)
Benefits to End Users Privacy Share only Virtual Address and no other sensitive information Multiple Utility Cash on delivery/bill split sharing/ merchant payments / remittances One Click 2 FA Authorise transaction by entering only the PIN (Biometric to Follow) Work across various interfaces Payment request generated on Web interface; authorized on Mobile interface (App) Payment through Aadhaar Number Pay using the Aadhaar number Availability & Security Available 24*&*365. Customer does the transaction on his personal device
Transaction Types Financial Transactions Pay Request Collect Request Non-Financial Transactions Mobile Banking Registration* Generate One Time Password ( OTP) Set / Change PIN Check Transaction Status * For mobile numbers already registered with the bank for SMS alerts
Authentication Authentication First Txn Authorised by Subsequent Txn Authorised by 1st Factor Mobile Number (OTP) Issuer Device Finger print PSP 2nd Factor PIN or Biometrics Issuer PIN or Biometrics Issuer Single Click 2FA
Simple enabling Steps Step 1 Download PSP App and create Profile Step 2 Add Bank Account/s Step 3 Register for Mobile banking, if not already registered / Generate PIN for Transactions
Use Cases
Use Case 1 :- Collect Taxi Fare (Proximity PULL) TAXI PSP APP sam@ABCbank Submit 1 Customers virtual address A/C details of taxi driver 2 Identifies Customers PSP ABCbank and routes to ABCbank Payee ( Merchants) PSP 5 PSP validates the customer details. Send the financial details to UPI for debit to customer account. Customers PSP 4 MPIN entered by Customer9 Successful credit 8 Credit Request PSP APP MPIN Submit 3 Sends notification for payment 10 Txn Confirmation 6 Debit Request 7 Successful Debit basis MPIN Customers Bank Taxi Drivers Bank Taxi Driver PSP 11 Response to Payee UPI
Use Case 2 :- Remittance (Remote PUSH) 13 PSP APP Enter MPIN Submit 1 Captures Receiver Virtual address. Sender enters Issuing Bank MPIN and amount 2 Sender Customers A/C details & MPIN Beneficiarys Virtual Add 3 Identifies Beneficiarys Handle. Sends to Beneficiary Customer PSP Beneficiary Customers PSP4 Beneficiary PSP responds with financial address of Beneficiary Customer Sender Customers Bank 5 Sender Customers A/C details & MPIN Debit Request 6 Successful Debit response 7 Credit Request 9 Transaction Confirmation 8 Successful Credit Enter Beneficiarys Details (V.A) Validates the TXN using Device finger print Device ID/App ID, Mobile Number 10 Txn response Sender PSP Beneficiary Customers Bank UPI
Use Cases
ITS YOURS.. UPI

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Unified Payments Interface (UPI) - Introduction

  • 2. Push and Pull Payments Virtual Address (Username@PSPName) Transfer using Single identifier like Aadhaar No Banks (Payment Service Provider) will provide App to customers of any bank One App for all transaction needs Single Click 2FA Unified Payments Interface
  • 3. Participants PAYMENT SERVICE PROVIDER (PSP) PSPs will be banks who will provide Apps BANKS Merchant or customers bank (account relationship) NPCI provides UPI interface.
  • 4. Benefits to Banks Simple (Single click 2FA) Universal App for transactions Leverages existing Infrastructure Secure Payments basis Single/Unique Identifier Tap C2B segment & E-Com / M-Com
  • 5. Benefits to Merchants Seamless fund collection from customers - single identifiers No risk of storing customers virtual address like in Cards Tap customers not having credit/debit cards Suitable for e-Com & m- Com/ Resolves the COD collection problem Single click 2FA facility to the customer - seamless Pull In-App Payments (IAP)
  • 6. Benefits to End Users Privacy Share only Virtual Address and no other sensitive information Multiple Utility Cash on delivery/bill split sharing/ merchant payments / remittances One Click 2 FA Authorise transaction by entering only the PIN (Biometric to Follow) Work across various interfaces Payment request generated on Web interface; authorized on Mobile interface (App) Payment through Aadhaar Number Pay using the Aadhaar number Availability & Security Available 24*&*365. Customer does the transaction on his personal device
  • 7. Transaction Types Financial Transactions Pay Request Collect Request Non-Financial Transactions Mobile Banking Registration* Generate One Time Password ( OTP) Set / Change PIN Check Transaction Status * For mobile numbers already registered with the bank for SMS alerts
  • 8. Authentication Authentication First Txn Authorised by Subsequent Txn Authorised by 1st Factor Mobile Number (OTP) Issuer Device Finger print PSP 2nd Factor PIN or Biometrics Issuer PIN or Biometrics Issuer Single Click 2FA
  • 9. Simple enabling Steps Step 1 Download PSP App and create Profile Step 2 Add Bank Account/s Step 3 Register for Mobile banking, if not already registered / Generate PIN for Transactions
  • 11. Use Case 1 :- Collect Taxi Fare (Proximity PULL) TAXI PSP APP sam@ABCbank Submit 1 Customers virtual address A/C details of taxi driver 2 Identifies Customers PSP ABCbank and routes to ABCbank Payee ( Merchants) PSP 5 PSP validates the customer details. Send the financial details to UPI for debit to customer account. Customers PSP 4 MPIN entered by Customer9 Successful credit 8 Credit Request PSP APP MPIN Submit 3 Sends notification for payment 10 Txn Confirmation 6 Debit Request 7 Successful Debit basis MPIN Customers Bank Taxi Drivers Bank Taxi Driver PSP 11 Response to Payee UPI
  • 12. Use Case 2 :- Remittance (Remote PUSH) 13 PSP APP Enter MPIN Submit 1 Captures Receiver Virtual address. Sender enters Issuing Bank MPIN and amount 2 Sender Customers A/C details & MPIN Beneficiarys Virtual Add 3 Identifies Beneficiarys Handle. Sends to Beneficiary Customer PSP Beneficiary Customers PSP4 Beneficiary PSP responds with financial address of Beneficiary Customer Sender Customers Bank 5 Sender Customers A/C details & MPIN Debit Request 6 Successful Debit response 7 Credit Request 9 Transaction Confirmation 8 Successful Credit Enter Beneficiarys Details (V.A) Validates the TXN using Device finger print Device ID/App ID, Mobile Number 10 Txn response Sender PSP Beneficiary Customers Bank UPI