UPI – Send money using VPA
What information do you need if you want to send money to someone’s bank account?
Account Holder Name,
Bank Name and
Bank IFSC codeYou need at least these details, right?
It is very hard to remember all those details and even If you write those details somewhere that might be misused by others.At this time you might be thinking that I will use wallets like payTM/card transfer facility to transfer money. But all of these methods charge some transaction fee. So, the government of INDIA provided a solution to all these problems by introducing a new method of payment system i.e., UPI
What is UPI:Unified Payments Interface (UPI) is a payment system launched by National Payments Corporation of India and regulated by the Reserve Bank of India which facilitates the instant fund transfer between two bank accounts on the mobile platform.
Working of UPI:For the very first time, every user needs to create an ID. This ID is the unique number to identify your details. This ID is called as VPA(Virtual Payment Address) in banking terms. One can link their bank account/s and cards to this VPA. After creation of VPA, money can be transferred easily.
Steps to create a VPA:
- Download the UPI application from the App Store / Banks website.
- Creates your profile by entering details like name, virtual id (payment address), password etc.
- Go to “Add/Link/Manage Bank Account” option and link the bank and account number with the virtual id.
How to get UPI app:As I have told you in the beginning, the UPI payment system works only through the mobile application. There are several UPI Apps. You can choose any of them. Each bank can launch its UPI-based APP. Banks can also incorporate UPI features into their existing mobile application. Such as, the ICICI Bank has incorporated UPI into the iMobile and Pockets. In fact, most of the banks have incorporated UPI in their existing mobile application. Hence, if you already have an app of a bank, the update would be sufficient. Otherwise, you can download the UPI enabled app from the google play store.
Which UPI app should I download:There are several UPI apps in the Google Play store. There are many apps e. g BHIM app, SBI Pay, Pockets, HDFC Mobile, iMobile, Phonepe, PNB UPI etc. You may be confused. Which App should you download? Should you download the UPI enabled app of your existing bank? Actually, you are free to download any UPI enabled app. It can be from your bank or from any other bank. Choose an App which has the better interface. However, I understand, that the obvious choice would be the app from your bank. But, don’t fret to try the other apps. You can start with the BHIM app. It is basic app and very simple.
Charge of UPI transfer:A transaction through the UPI would cost about 50 paisa. Whereas the fund transfer through the NEFT costs at least Rs 2.5. On the other hand, the IMPS fund transfer charges minimum Rs 2.5. The payment through the credit cards is much costly however the seller bears it. Now seller can pass the benefit of low cost of the transaction to you.
Benefits of UPI:
- Round the clock availability ( 24*7 and 365 days)
- Single Application for accessing different bank accounts
- Use of Virtual ID is more secure, no credential sharing
- Single click authentication