Unified Payments Interface (UPI) is an instant real-time payment system developed

by National Payments Corporation of India facilitating inter-bank transactions. The interface

is regulated by the Reserve Bank of India and works by instantly transferring funds between
two bank accounts on a mobile platform.
UPI is built over Immediate Payment Service (IMPS) for transferring funds. Being a digital
payment system it is available 24*7 and across public holidays. Unlike traditional mobile
wallets, which takes a specified amount of money from user and stores it in its own
accounts, UPI withdraws and deposits funds directly from the bank account whenever a
transaction is requested. It uses Virtual Payment Address (a unique ID provided by the
bank), Account Number with IFS Code, Mobile Number with MMID (Mobile Money
Identifier), Aadhaar Number, or a one-time use Virtual ID. An UPI-PIN (UPI Personal
Identification number that one creates on the UPI app of the bank) is required to confirm
each payment.
At present, the upper limit per UPI transaction is Rs.1 Lakh.
The transaction charges to be levied in UPI are left up to the banks as policy matter of
individual banks thus a varied opinion exists among the bankers about imposing such
charges. Many bankers feel that imposing transaction charges will hamper UPI adoption.
 HDFC bank has held its decision about charging its customers for UPI transactions.[4]
 SBI has proposed charging for UPI transaction in future
The UPI system also gives you the facility to ask money from someone. Follow these steps.
If the person approves your collect request, you would immediately get the money.\
The HDFC bank has integrated the UPI into its existing mobile banking app. It has not
included the UPI yet into its ‘chiller’ and ‘PayZapp’ app.

Transaction Statistics
Year Transaction Volume (In Million) Transaction Value (In Rs. Billion)

2016-17 17.86 69.47

2017-18 737.18 856.59

The huge surge in UPI transactions in 2017-18 were largely due to launch Google Tez, a UPI
based payments app. Google Tez came up with attractive referral offers and incentives for
customers which led to greater adoption of UPI platform.
BHIM (Bharat Interface for Money) is a mobile app developed by National Payments
Corporation of India (NPCI), based on the Unified Payment Interface (UPI)
Almost every wallet app started using UPI because it has a huge potential.Eg,: Paytm,
phonepe, google tez, bhim, etc.