UPI is the payment system revolution in India, but is UPI bringing down the candy industry?

[ad_1]

UPI is the payment system revolution in India, but is UPI bringing down the candy industry?

Unheard of or incredulous before April 2016, the United payment interface (UPI) is now the standard bearer for India’s ongoing financial revolution. Much of our society has adapted to UPI, from a tea vendor selling an Rs 10 Cutting Chai to a store offering a selection of expensive goods. He actively uses the system for smooth payments.

UPI’s constant development has not only created a reliable payment method, but also connected millions of people on a vast and well-organized digital platform. The confectionery industry, for example, is at the same time strongly impacted by this digital platform.

However, not everyone is happy with it. On a totally unrelated topic, many people believe that the growth and development of UPI has been detrimental to the confectionery industry. When the shopkeeper had no change, he offered sweets.

Before UPI came along, store owners exchanged excess cash for toffees; the transaction did not go the other way. According to the report, many customers admitted that these small sums eventually grew to represent large sums of money. GrowthX Founder Abhishek Patil said, “This was all terminated by UPI because individuals started paying the full amount required without trying to negotiate, which killed the daily toffee sales.”

Patil also claimed that the virus was responsible for the rise in UPI usage nationwide. Because the majority of the crowd was fearful of the pandemic, everyone wanted to use contactless payments. Toffee was therefore no longer an option, and there was also a trend towards electronic payments, Patil continued. Any toffee maker would never have considered financial products a rival. According to him, caramels were a substitute for cash, and UPI superseded that need and behavior.

UPI Payment: India Recorded 9.36 Billion Transactions Worth Rs 10.2 Trillion in Q1 2022, UPI Leads - The Economic Times

About UPI

This digital payment gateway system is regulated by the Reserve Bank of India and was created by the National Payments Corporation of India. The beauty of UPI is that since it is an open source API, any mobile payment application developed by PSP companies or banks can access it (Application Programming Interface). It acts as a conduit, connecting banks, merchants and customers to enable easy and fast transactions.

Cash and other conventional payment methods made up a large part of India’s economy until the introduction of UPI in 2016.

Currently, India has access to instant money transfers at the touch of a finger, as opposed to bartering or exchanging goods for gold and silver coins.

The beauty of UPI is in its simplicity, unlike IMPS, which requires the recipient’s bank account information and IFSC code to complete a transaction. UPI is based on the IMPS infrastructure. Any compatible mobile application allows users to access any bank account, and all that is needed to start a transaction is the recipient’s UPI, which can be in the form of a mobile number, a QR code or even just the virtual payment address. The UPI transaction PIN is the same for all UPI payment apps, allowing for increased interoperability and the ability to make payments 24/7/365.

There is no need to rely on particular banks because the UPI is centralized. The UPI was developed as a digital public infrastructure that can be used by all players, large and small, including customers and merchants, with seamless interoperability and no transaction fees, which is why it is so widely used. To encourage healthy competition and prevent oligopoly, the Reserve Bank of India (RBI) has also imposed a cap on the percentage of the market that UPI payment players can hold.

Indians no longer prefer to have change on them and the country is moving towards a cashless society. Getting change and waiting for change is both hassle-free. UPI transactions made possible by apps like GooglePay, PhonePe and PayTM were a blessing in disguise even during the pandemic, when social withdrawal was the accepted norm. People gravitate towards UPI transactions with an almost natural propensity.

Undoubtedly, it is now evident that this industry is heading for explosive expansion shortly. Digital payments in India are currently experiencing a boom and a spike, especially with the pandemic.

nepal will use indian payment system upi

There are some factors why UPI is so acceptable by Indians:

  • Simple and individualistic: From the user’s favorite app, making or receiving a payment is as easy as a simple click or swipe. The UI/UX has been improved and simplified for widespread use.
  • Innovative: It should be noted that the Immediate Payment Service (IMPS) infrastructure has played a crucial role in the huge success of UPI. Transactions are easier since adopting a UPI ID instead of typing in bank account numbers and IFSC codes. To create an innovative platform, integration with Bharat Bill Payment System (BBPS) for recurring bill payments has become essential.
  • Understood: UPI is inclusive and not limited to a single application. GooglePay, Paytm and PhonePe are the main drivers of UPI growth, with WhatsappPay and AmazonPay joining the fray. UPI interoperability shows that after registering, a user can immediately transfer or receive money from anyone else using the UPI system.
  • Security: UPI’s high level of security is one of its strengths. End-to-end data protection and security are reliably provided by UPI. Users must first register for UPI using the same mobile number already registered with the bank. UPI operates on a highly secure platform. The platform is further bolstered by the RBI’s KYC mandate.

In terms of volume, UPI is the largest retail payment system in the country, and monthly UPI transactions outnumber those made using debit and credit cards combined. Moreover, 50% of all UPI transactions are worth up to Rs 200. UPI has been so successful that many countries including Brazil, Singapore, Saudi Arabia, the United States and the Union European Union, are trying to implement a similar system. in their regions.

edited and proofread by nikita sharma

[ad_2]
Source link

Elaine R. Knight