Unified Payment Interface (UPI) is the supreme payment system contributing to more than 16% of retail payment transactions in India. Because of its simplicity and effectiveness, most vendors and small-scale business owners like to rely on this mode of payment. However, many other options are available when it comes to online payments. According to the survey reports, UPI can now hog 220 million daily transactions, projected to increase four times more than the existing metrics exponentially. Isn’t that baffling and surprising that UPI stood out from the masses despite competing among so many giant players providing other payment services?
It has significantly altered the way people handle their payments. India, infamous for its dependence on a cash delivery system, has witnessed a massive shift in the digital payment landscape. Third-party global apps like Google pay and Phone Pe also proved to be a part of the driving force behind this revolution. NPCI (National payments corporation of India) has issued guidelines to these external players to cut down their respective shares to volume transactions of 30% each to prevent the concentration of payment systems on limited platforms.
Let us compare the usability factors of different digital modes of payments to understand why UPI is the reigning supremacy:
- The biggest boon with the usage of UPI is eliminating the additional cost of payment service, no wonder millions of merchants, from the owner of a world-class textile showroom to a roadside vendor selling fruits, have the QR board for Gpay or PhonePe with them without having to bother to pay extra for making or receiving payments. On the other hand, with credit and debit cards, there is a limitation on the availability of POS machines, even if some have them. They won’t allow swiping, but only for the predetermined amount because of the extra charges that incur due to this mode of payment.
- Similarly, let’s consider the case of net banking. The due diligence of adding the beneficiaries and waiting for them to reflect, only after that can one initiate the payment process. UPI apps like Paytm, PhonePe, and pay spare consumers from such hassles and provide a seamless and contactless payment service which proved to be bliss during the unprecedented pandemic.
- The whole process is smooth for digital wallets, except that one needs to deposit digital cash before making payments. So, if you need to use your digital wallet, you must perform two payment executions. Why waste your time and effort when UPI apps can only facilitate one-time payment with a few clicks?
UPI has helped India as a nation to embrace digitization, especially because of the pandemic. Folks realized the true potential of this real-time and cost-effective payment system. There is also complete transparency and trustability because of the two-way authentication mandate of RBI, and all the UPI apps comply with that rule. Gift cards are another beneficial aspect of using UPI apps as some E-commerce platforms provide the option of buying gift cards at huge discounts for our near and dear ones only if the payment is made using UPI, a great initiative of community building and spreading positivity.