The Unified Payments Interface (UPI) has revolutionized digital payments in India . UPI is a real-time payment system that facilitates quick and easy transactions .
New Rule of UPI in march 2025:
As of March 2025, new rules for UPI (Unified Payments Interface) include:
- Bima-ASBA for Insurance Premiums: UPI users can now pay insurance premiums through blocked amounts under the Bima-ASBA (Applications Supported by Blocked Amount) facility . This means the money remains in the policyholder’s account but is blocked until the insurance policy is issued . If the policy is not issued, the blocked amount is released back to the policyholder . Insurers are mandated to offer Bima-ASBA, but it is not compulsory for customers .
- Mobile Number Portability: Banks and UPI apps are implementing new rules for mobile number portability by March 31, 2025 .
- UPI Lite Account: When changing devices, a new UPI Lite account will be created for the new device .
UPI work in India :
UPI (Unified Payments Interface) is a mobile application that allows users to transfer money between bank accounts . Here’s how it works in India:
- Functionality UPI enables peer-to-peer inter-bank transfers through a single window . It eliminates the need to enter bank details or sensitive information for each transaction . UPI uses existing systems like Immediate Payment Service (IMPS) and Aadhaar Enabled Payment System (AEPS) to ensure seamless transactions .
- Sending Money To send money, a user logs into the UPI interface, selects the “Send Money/Payment” option, enters the recipient’s virtual ID and the amount, chooses the account to debit, enters a PIN, and receives confirmation . This process is also known as a “push” .
- Receiving Money To receive money, a user logs in, selects the “collect money” option, enters the remitter’s virtual ID and the amount, and chooses the deposit account. The payer receives a payment request and authorizes the transaction by entering their UPI PIN . Receiving money is also known as a “pull” .
- Confirmation Once a transfer is complete, both the sender and recipient get a confirmation via text message .
- Additional Features UPI allows users to check balances, view transaction histories, and make over-the-counter or barcode payments. It can also be used for recurring payments like utility bills and subscriptions .
- Safety UPI is considered a safe and secure method for transferring money, reducing the need for physical cash transactions . It is also regulated by the Reserve Bank of India (RBI) .
- Availability Numerous banking and payment apps in India support UPI, including PhonePe, Google Pay, Axis Pay, and BHIM . In short, UPI is a convenient and secure system for conducting financial transactions via smartphones, making digital payments easier across India .
benefits of using UPI for payments :
The benefits of using UPI (Unified Payments Interface) for payments are numerous, offering convenience, security, and efficiency . Here’s a detailed breakdown:
- Ease of Use UPI simplifies transactions by allowing users to send and receive money directly from their bank accounts using a virtual ID or UPI ID, eliminating the need to remember or enter bank account details repeatedly .
- Speed UPI enables instant real-time transfers, ensuring that payments are processed immediately .
- 24/7 Availability UPI services are available 24/7, including weekends and holidays, providing users the flexibility to transact at any time .
- Security UPI transactions are highly secure, requiring a UPI PIN for each payment, adding an extra layer of protection against unauthorized access .
- Versatility UPI can be used for various types of transactions, including peer-to-peer transfers, online shopping, bill payments, and merchant payments .
- Reduced Cash Dependency By facilitating easy digital payments, UPI helps reduce reliance on cash transactions, promoting a cashless economy .
- Multiple Bank Accounts Users can link multiple bank accounts to a single UPI app, making it convenient to manage funds from different accounts in one place .
- Payment Request Feature UPI allows users to send payment requests to others, making it easier to collect money from friends, family, or customers .
- Merchant Convenience Merchants benefit from UPI as it offers a cost-effective and efficient payment solution, reducing the need for expensive POS infrastructure .
- Government Support UPI is backed by the Indian government and the Reserve Bank of India (RBI), ensuring its reliability and promoting its adoption across the country . In summary, UPI offers a secure, convenient, and versatile payment solution with round-the-clock availability, reducing the need for cash and simplifying digital transactions for both consumers and merchants .
Can UPI be used for international transactions ?
Yes, UPI can be used for international transactions in select countries .
- Expansion UPI is expanding its reach, allowing users to make payments abroad .
- Countries Accepting UPI As of early 2025, countries such as Nepal, Qatar, Bhutan, Mauritius, Singapore, Sri Lanka, and the UAE accept UPI payments . In 2024, the Eiffel Tower in Paris became the first French merchant to accept UPI .
- UPI One World Wallet For travelers visiting India, the UPI One World wallet allows payments at merchant locations by scanning QR codes. Any unused balance can be transferred back in accordance with forex regulations .
- Linking International Numbers Non-Resident Indians (NRIs) with NRE/NRO accounts can use UPI with their international mobile numbers via apps like iMobile (ICICI Bank), BHIM, and PhonePe . This is available for numbers from Australia, Canada, France, Hong Kong, Malaysia, Singapore, United Arab Emirates, United Kingdom, and the United States of America .
- Cashback Offers RuPay JCB credit and debit cards provide cashback on international PoS transactions in countries like Japan, Singapore, Indonesia, and the Philippines . While UPI QR codes are primarily for domestic transactions, its international presence is growing, making it easier for Indian travelers and NRIs to conduct transactions abroad .
