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What is ECS Mandate?

What Is ECS Mandate

Electronic Clearing Service(ECS) - What it is and How it Works

Remember when paying bills manually or offline was a thing? Every month, a calendar was prepared to mark the due dates of different bills, waiting in long queues was mandatory to get the bills paid.

Earlier everything was done manually, which required a lot of time and patience, since ECS Mandate was implemented this service helped in bridging the gap and making the process easier for recurring payments.

What is an ECS Mandate?

An ECS (Electronic Clearing Service) is an electronic method of payment used for recurring or periodic transactions. The RBI launched ECS for the convenience of bulk fund transfers from one bank account to another.

The NPCI (National Payments Corporation of India) administers the National Automated Clearing House (NACH), which manages ECS debit in India. 

Companies and institutions use ECS to perform bulk payments to pay dividends, interest, salaries, pensions, etc., or collect amounts continuously, for example, telephone/electricity/water rates, tax payments, loan payments, pensions, etc.

For Example; If you take a loan, such as a personal loan or home loan, you’ll be required to pay the EMI every month. Delayed payments may result in penalties, and regular late payments can also affect the credit rating.

To resolve the issue, lenders in India have now introduced Electronic Clearing Service (ECS) for borrowers. With this system, lenders use a clearinghouse to debit EMIs from a customer’s account on a fixed date.

Types of an ECS mandate

There are two types of ECS

  1. ECS Credit
  2. ECS Debit

ECS Credit

ECS Credit is used by an institution for affording credit to a large number of beneficiaries (for instance, employees, investors) having accounts with bank branches at various locations of the ECS Centre to credit one single account. 

The ECS Credit enables payment of amounts towards dividend distribution, interest distribution, salary distribution, pension distribution, etc.

ECS Debit

ECS Debit allows an institution to make a debit to a large number of accounts (consumers of utility services, borrowers, investors in mutual funds, etc.) maintained with bank branches at various locations of the ECS Centre to credit one single account.

ECS Debit is convenient for recurring payments, like telephone/electricity/water bills, cess/tax collections, loan installment repayments, periodic investments in mutual funds, insurance premiums, etc.

How Does An ECS Mandate Work?

When you take a loan, an ECS payment mandate is necessary. This mandate instructs the clearinghouse to debit monthly EMIs from your bank accounts and credit the funds into your loan account, or to the lender’s account on a fixed date.

The mandate will contain detailed information about your bank account, bank branch, ECS debit date, and debit amount.

How can I get a duly signed ECS mandate?

If you wish to apply for an ECS Mandate, you must inform your bank or lending institution that permits it to deduct a certain amount for any acquisitions made. 

ECS Mandates include an account number, branch address, and other account details. 

ECS users can set a maximum amount that can be deducted from their account. 

What are the advantages of an ECS?

As per the Reserve Bank of India-  Both ECS Credit and ECS Debit have many advantages to the beneficiary, Institutions, and banking system.

Advantages of ECS Credit that beneficiary have

Beneficiaries don’t need to go to their bank to deposit the papers they would usually receive if they had not used the ECS Credit service.  A beneficiary does not need to be concerned about the loss of physical instruments or the possibility of fraudulent encashment of them. Receiving funds by ECS is a cost-effective method. Moreover, the beneficiary receives the funds on the due date.

ECS Credit Scheme benefit for User Institutions

User Institutions also enjoy many advantages when beneficiaries choose ECS credit, such as saving on administrative machinery and printing; dispatching costs, and reducing their costs related to the reconciliation of paper instruments. The possibilities of instruments being lost/theft in transit, chances of fraudulent encashment of paper instruments, and the subsequent correspondence/litigation are minimized. Cost-effective means of making sure the beneficiaries get their benefits on a scheduled date.

ECS Credit benefits for the banking system

Clearing payments are processed faster and easier by eliminating the handling, presenting, and monitoring of physical instruments. Payments are returned faster to the destination bank branches.

The benefits of the ECS Debit Scheme to customers

Customers will not have to visit bank branches/collection centers of utility service providers to make payments since ECS Debit mandates will take care of automatic debits on due dates without visiting banks and utility service providers. Customers’ accounts would be monitored by ECS Users, and they would be alerted accordingly.

ECS Debit Scheme benefits for user institutions

The ECS Debit Scheme provides many benefits for user Institutions, including reduction of administrative overhead and saving on collection costs, monitoring and reconciliation processes. Increased cash flow since dues are recovered promptly and efficiently on due dates. It reduces the chances of instruments being stolen, lost, or fraudulently accessed, and then used. Cost-effective because payments are realized on one date rather than received on fragmented dates.

With ECS Debit, the banking system benefits from

It is no longer necessary to handle, receive, monitor, or manage paper instruments. Bank branches can deduct the customers’ accounts after confirming that the customer’s account number is in the bank’s database, as well as ensuring that there is a valid mandate, and all its particulars. This process can be completed with minimal manual intervention with the help of core banking systems and straight-through processing. Easy reconciliation procedure for sponsor banks and is Cost-effective.

How do you discontinue an ECS scheme?

To discontinue an ECS scheme, the customer has to provide prior notice to the ECS user institution, to ensure that the input files submitted by the user discontinue to include the ECS Debit details in respect of the mandates withdrawn by customers. 

There are two steps you need to follow to ensure appropriate closure.

  1. To stop the services, the service provider, which is the beneficiary of the payment, will have to be given a written communication in the way specified by them.
  2. A written request stating you want to discontinue will also need to be submitted by you to the bank.

What are ECS mandate charges?

The Reserve Bank of India (RBI) has deregulated the charges to be levied by sponsor banks from user institutions.  The sponsor banks are required to reveal the charges transparently. 

However, the Bank branches do not generally charge processing fees for debiting the accounts of customers maintained with them.

Conclusion

An ECS benefits the user and also the lender, this is useful when people need to make digital periodic payments, such as if they have to pay their EMI loan, Bills, or SIP installments. 
Using this service enables you to be more productive as you don’t have to write cheques every month, and this also decreases the probability of missing bill due dates.
You must take ECS very seriously since it has the same effect as a cheque issued by you. This means you have to make sure there are sufficient funds available in your account for your ECS to get processed. If you bounce an ECS, you will be liable just like you would for a bounced cheque.
As for the beneficiary of payments, ECS is a boon because they don’t have to remind the payer, and the payment will be received automatically due to the electronic clearing service.
It helps the customer systematically manage the debts since they have the flexibility of issuing more than one ECS and can also modify the amount of ECS and therefore he can easily manage his debts.

ECS Mandate FAQ's

What is the full form of ECS?

ECS Stands For Electronic Clearing Service.

What is an electronic clearing service?

Electronic Clearing Service (ECS) is an electronic mode of funds transfer from one bank account to another bank account. The customer needs to provide a mandate that authorizes the institution, to debit or credit payments to the bank account.

What Are The Advantages Of ECS Mandate?

  1. Enhances consumer satisfaction
  2. No late payment charges
  3. Makes timely installments of bills
  4. Enables customers to make timely recurring payments of insurance premiums, credit cards, telephone/electricity bills, mutual funds, loan installments, etc.

How to Stop ECS?

A written application needs to be submitted weeks before your EMI debit date to the loan provider in a format prescribed. The bank needs to be informed about the same by submitting a written application.

Do I have to give an ECS mandate for every bill payment?

ECS mandate needs to be submitted only once, this remains valid until it’s withdrawn by the customer.

At how many locations does the ECS scheme operate?

Based on the location of branches, there are three broad categories of ECS Schemes

  1. Local ECS
  2. Regional ECS
  3. National ECS

The schemes are either operated by RBI or by the designated commercial banks.

Local ECS

The branch coverage at the clearinghouses is usually limited to the geographic area within which the clearinghouses are located. Typically, this is one city and/or satellite towns.

It is operating at 81 centers/locations across the country.

Regional ECS

RECS facilitates the coverage of all branches enabled in the core banking system in a State or a group of States and can be used by institutions that wish to reach beneficiaries in the State/group of States. 

Since the system uses the core banking system in banks, the actual accounts may be held in various bank branches across the length and breadth of the State/group of States; even though the interbank settlement occurs centrally in the State.

It is operating at 9 centers/locations in various parts of the country. 

National ECS

NECS allows banks to add any core-banking-enabled branch to their system regardless of its location. It is the centralized version of ECS Credit, which was launched in October 2008. 

This scheme is operated in Mumbai and covers all branches with core banking capabilities across the country. Similarly, this system takes advantage of core banking systems in banks. Even though the inter-bank settlement takes place at a central location in Mumbai, the actual customers under the Scheme may have their accounts at different bank branches across the country. 

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Banking digital payments fintech Hybrid payment gateway payment gateway

Security feature: UPI vs Wallets vs Digital Cards

How secure is your payment ecosystem?

The other day I was chatting with a villager on my trip to Rajasthan. He was the owner of a large oilseeds field. Unfortunately, he faced a crop failure due to a delay in rains. Luckily, the crop insurance scheme was his savior.

“What mode do you use for insurance payment?” I asked inquisitively.

“I prefer the UPI Madam. It is so convenient. Direct bank to bank transfer. It has made our lives easier. Previously, I made use of wallets. But, loading money gets hectic sometimes. Also, the security is minimal. How can we be assured that our money is in safe hands?” he replied.

It was amazing to see the outreach of the UPI payment system to the deep pockets of the rural regions of India. Interestingly, the security features of the UPI payment mode left me in awe.

Security Feature of UPI vs Cards vs Wallets
Security features of UPI vs Cards vs Wallets

UPI boasts of a superior payment mode as compared to wallets and digital cards. With UPI 2.0, the signed intent & QR and Invoice in the inbox security features are added.

In the course of this blog, let us compare the security features of UPI vis a vis Digital Cards and Wallets.

Security Features of UPI

UPI Security feature 1: Binding with mobile number

This is a significant feature of UPI that brings in the first layer of security. UPI verification of the user happens during the initial login and registration. The UPI app binds with your mobile number to verify your identity. In case, you change the phone or the number, you need to verify your identity again. This option ensures that your credentials stay safe in case of a mobile threat or identity threat.

UPI Security feature 2: Two-factor authentication

The second security feature comes into effect during the transaction process. While registering on UPI, users are given an option to set an MPIN (Mobile PIN). It is a 4 or 6 digit number set up while registering on the UPI app. You can generate it by clicking on create/generate MPIN tab and entering the debit card details (last six digits and card expiry details). In the course of transactions, this MPIN is used to authenticate a transaction. You can also change the MPIN if you forget it, using the same create/generate MPIN tab.  

UPI Security feature 3: Signed intent and QR

With a quick response code (QR) and signed intent option, users can check the authenticity of the merchants. Users have the option to check if the merchants are UPI verified or not. In case the merchant is not UPI verified, users get information via notifications. This security feature ensures that QR code tampering frauds remain low. Hence, signed intent and QR features bring in secure and tamper-proof transactions.

UPI Security feature 4: Invoice in the inbox

This is a noteworthy and secure feature addition to the UPI. Before initiating your payment to the merchant, it is possible to view the generated invoice. This brings in security by verifying the credentials of the transacting merchant. In other words, this feature safeguards you from fraudulent transactions.

 

Security Feature of Digital Card

Comparatively, Digital card offers different security features. Nevertheless, it is unique and robust in itself.

For example, Digital cards have an option of confirming the transaction either using password or an OTP (one time password). Also, some banks require you to not repeat the previous three used passwords. Further, SMS cum Email alert is sent for each transaction.

 

Security Feature of Wallet

As compared to UPI, wallets offer a lesser level of security. For example, many wallets do not offer two-factor authentication. But on the other hand, the QR code feature of wallets minimizes the payment data.

Nevertheless, there is a chance of security compromise in the case of wallets due to the indirect involvement of the bank. It is basically a wallet to wallet money transfer.

Summary

  • UPI offers security via 2 factor authentication, QR & Signed Intent and Invoice in Inbox
  • Digital Card security is via password or OTP
  • Wallet security follows a 1 factor authentication

References:

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artificial intelligence Banking digital payments fintech Hybrid payment gateway

Can Artificial Intelligence Bring Magic for UPI Payments in 2020?

AI is here to simplify your business’s payments

When was the last time you logged into a payment gateway website and was greeted by a chatbot? What was your feeling when all your queries were addressed in a seamless and systematic manner? Did you ever wonder what drives the chatbots? The answer lies in the magic of artificial intelligence.

Artificial intelligence is making great strides in the payments domain while bringing in automation and added security features. For example, ILA is SBI Card’s live assistant providing you with the information on the latest products. Similarly, Mansha AI is SabPaisa’s AI assistant that makes use of artificial intelligence to answer all the payment related queries.

In the course of this blog, let us delve deep into the prospects of artificial intelligence in the payments domain.

1. Artificial Intelligence and Automation

The crux of artificial intelligence lies in automating your payment process coupled with automated queries. Imagine you face a payment issue while transacting on a payment gateway or a bank page, how would you feel if there is no customer support available? You feel stranded and left out. But, imagine a chatbot offering you help without any prior notice. Your payment issue is clarified instantly and money remains in safe hands.

Take another case, imagine you want to apply for a credit card. There are a lot of options that are confusing. You keep searching day and night, staring at a dead end. But, imagine if AI can help you assist with the ideal card based on your credit history, how would it feel? One can benefit from the right guidance of AI technology.

2. Artificial Intelligence and Database Management

Payments domain comes with a huge database of banks, customers, merchants, clients, etc. Isn’t it time-consuming to manually sort the database to get the desired information? But, don’t worry, database management is just a click away with the coming of AI. For example, artificial intelligence can give a personalized user experience. By analyzing your data and personal transaction history, a value add suggestion is put forth for future transactions.

Further, by going through your spending history, AI would suggest you the best savings and expenditure plan. In this way, Artificial intelligence inculcates prudent money management.

3. Artificial Intelligence and Fraud Handling

Payments domain faces many frauds like phishing, data theft, merchant fraud, friendly fraud, etc. This results in numerous security risks resulting in a massive loss of revenues. AI can pitch in at this juncture to bring in a fraud-free atmosphere.

Organizations are making use of predictive cum prescriptive analysis to detect fraud in payment transactions. For example, banks are using this method to detect fraud in recurring payments, mobile banking apps or remote ordering of services.

4. Artificial Intelligence and Compliance

Tired of following up with your customers on timely payments? Don’t worry, AI is here to help you out. An automated follow-up mail coupled with instant blocking of defaulting account brings in financial discipline. This keeps a check on willful defaulters which are on a rise.

In other words, AI can speed up timely payments thereby increasing revenue for the government and companies alike.

5. Artificial Intelligence and Reduction in False Declines

You might have experienced an unexpected rejection of your payments on the last stage checkout process. This false decline is due to the system falsely identifying some suspicious activity during your payment process. Here is where AI can come in to solve the problem. In other words, the AI algorithm can rightly distinguish between the right and false declines. Going ahead, this brings in huge relief and convenience to the banks, payment gateways and customers alike.

Summary:

  1. AI brings in the automation of the payment process
  2. Database management is eased with the help of AI
  3. AI helps in fraud management
  4. User compliance is ensured via AI
  5. Reduction of false decline is ensured via AI

References:

For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date.

Learn more about SabPaisa here: https://sabpaisa.in

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Banking digital payments fintech payment gateway

5 Ways How UPI is Changing the Payments Ecosystem in India

UPI has touched almost all sectors of India

Last week, I was at a new tea shop near my house. The tea cost me a meager ten rupees. But, upon checking my wallet, I was shocked to find it empty. The shop owner read my situation and told me, “Madam you can pay via GooglePay. Look at the code scanner, just scan and pay.” Then came the live-action of the UPI payments ecosystem in India.

I was in for another shock when my Google pay account was temporarily down. I saw the customer queue increasing. Immediately, I downloaded Phonepay into my mobile. Phonepay is a prominent app which supports UPI transaction. The payment took place within no time. This is the outreach of the UPI across the payments ecosystem in India.

UPI Payments Ecosystem in India

Why has UPI captured the payments space within four years of its inception? What makes it stand out from wallets or digital cards? UPI offers an immediate payment service with the help of either a VPA, mobile number or Aadhaar number. It makes the transaction channel secure and hassle-free.

UPI has made its mark felt in the different sectors of the Indian economy like Education, Health, Social Sector Schemes, etc. In the course of this blog, let us explore the outreach of the UPI payments ecosystem in India.

Payments Ecosystem 1: Government Schemes

Government of India’s flagship program Digital India aims to make India a digitally empowered society. Launched in the year 2015, Digital India relies on advanced technological infrastructure to serve the needs of the customer. Of this, digital payment forms an important cum core part.

In tune with its Digital India initiative, the government launched the BHIM UPI (Bharat Interface for Money). It makes use of the UPI platform for immediate bank to bank money transfer. Transfer validation happens either using a VPA (Virtual Payment Address) or a mobile number.

Key government schemes like Jan Dhan Yojana and Direct Benefits Transfer (DBT) have started using the UPI payments interface, transitioning from the RTGS or the NEFT based platform. It brings in ease and security to the payment transactions since the user does not have to remember complex details like the account number, bank name, etc.

Payments Ecosystem 2: Education

The education sector is witnessing rapid stride in the use of the UPI Platform. Payment platforms like Razorpay, Instamojo, SabPaisa, etc. have enabled it on their platform. For example, SabPaisa is the world’s first hybrid payment platform. It offers numerous payment modes ranging from UPI to Cards to Netbanking to Cash to NEFT. UPI is one of the focal product that helps in seamless payment transmission while paying college admission fees or paying the late fine.

Payments Ecosystem 3: Health

Health schemes in India are transitioning to the use of digital payments like UPI. Further, to promote the use of UPI, the government provides a number of incentives.

The major health schemes in India are Universal Health Insurance Scheme (UHIS), Ayushman Bharat, Aam Aadmi Bima Yojana (AABY), Rashtriya Swasthiya Bima Yojana (RSBY), etc. As part of the schemes, patients can pay through various digital modes like UPI, BHIM, credit/debit cards and wallets. The Ministry of Health and Family has issued advisories to all government and private hospitals to facilitate digital payments for ease of transactions.

Payments Ecosystem 4: Business

The business sector is witnessing new opportunities with the rapid advancements in UPI. For example, Fintech companies in India are being flooded with requests at an international level for UPI customization. Further, NPCI has relaxed the rules for small companies by increasing their monthly limit of Rs. 50,000. Also, the merchant onboarded under this category does not have to pay anything to the acquirer.

Payments Ecosystem 5: Miscellaneous

UPI has pervaded every aspect of our life. In addition to Tier I cities, Tier II and Tier III have seen an increased use of UPI. For example, if a user in a Tier III city wants to do a DTH recharge, he has to simply open the UPI app on his mobile and scan the code on the TV screen to kickstart the payment process. Similarly, UPI is used to buy on-demand movies in a seamless manner with the click of a button.

On the whole, UPI is the ripe technology of the future which continues to make notable advancements in a rapid manner. From education to the business sector, UPI has touched upon all the major sectors of the Indian Economy. In commensuration with Artificial Intelligence and Machine Learning, UPI holds significant promise for the future.

References:

For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date.

Learn more about SabPaisa here: https://sabpaisa.in

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Banking digital payments fintech payment gateway

Top Five UPI Platforms to Lessen your Payment Headache

Know the UPI Platforms that is best for you

When was the last time you did a digital payment? How pleasant or nasty was the process? What was the major challenge that you faced? Was it a Net connectivity issue or a wallet loading issue? Did you try using the UPI platforms?

UPI is rapidly taking over the payments space in India. Did you know that UPI platforms will dominate the payments space with 59% payment transactions in the near future? Mind-boggling isn’t it?

UPI Platforms - UPI Apps
UPI Platforms – UPI Apps

UPI or Unified Payments Interface is a next-generation instant payment platform built by NPCI (National Payments Corporation of India). With a simple account to account transfer process using the VPA (Virtual Payment Address), UPI is the favorite of Indians running across different classes. Interestingly, UPI crossed the landmark 1 billion mark in October 2019.

There are a number of UPI platforms that are both App as well as non-App based. Each of them offers a unique user interface based on the different user requirements. But, how to select the best UPI platform?

In the course of this blog, I will give you a tour of the top UPI platforms. Hope this helps you in both your personal and professional endeavor.

1. UPI Platforms 1: GooglePay

UPI Platforms - Google Pay
UPI Platforms – Google Pay

Google Pay is one of the popular payment apps from Google. Unlike BHIM App, Google Pay does not call for Aadhaar verification. There is a direct linkage of bank account using details like name, account number, IFSC Code, etc. Also, Google Pay (Tez) has a unique feature of AudioQR sharing directly from one mobile to another. Further, like BHIM UPI App, the amount is transferred from a bank account to another, thereby reducing the need for an intermediary wallet.

Going ahead, Google Pay is also expected to support Credit Cards, Debit Cards, and e-wallets. 

2. PhonePe

UPI Platforms - Phonepe
UPI Platforms – PhonePe

PhonePe is a popular payment app with the option of UPI connectivity. The most important feature is the option of an additional wallet link and non-necessity of initial login. There is no option of mandatory login using the Phonepe App. One can directly login to the site using the website URL. Also, Phonepe gives access to popular linked wallets like JioMoney, Airtel Money, Freecharge, etc.

Going ahead, Phonepe has an innovative feature of navigating between over 50 apps. This is possible without downloading the app on your mobile or updating the same.

3. UPI Platforms 2: BHIM UPI

UPI Platforms - BHIM UPI
UPI Platforms – BHIM UPI

BHIM App is the most popular UPI payment App. It has an interesting feature of making UPI transactions from different banks on a single platform. Interestingly, BHIM App at present is available in 13 languages.

In addition to, Send Money, Receive Money and Scan & Pay option, you can also check your pending transactions via BHIM App. There is also an option of raising complaints about the declined transactions.

Further, the built-in security feature allows you to block users who put forth illicit money requests. Also, the user privacy feature enables you to disable your first UPI Id in case of the generation of a secondary UPI Id.

Going ahead, you don’t have to worry about payment reminders or splitting bills. There is an option to set a payment reminder as well as split bill with multiple UPI users in an instant.

4. Paytm

UPI Platforms – Paytm

Recently, Paytm has enabled BHIM UPI on its payment platform. It follows a simple setup process with the selection of the ‘UPI App’ option from the Paytm App. Once the bank account and mobile number are verified, you can set the MPIN to start the transactions. The UPI Id follows the format [email protected]

Further, on changing the mobile, the verification of the new mobile number is mandatory to use BHIM UPI on Paytm.

5. SabPaisa

UPI Platforms - SabPaisa UPI
UPI Platforms – SabPaisa UPI

SabPaisa is the next generation payment platform that offers a hybrid payment gateway model ( e-offline + e-online ). It is the only hybrid (online+offline) payment platform in the world that provides businesses and organizations a single unified dashboard for collecting payments from their customers/members through any and all channels, online or offline, from UPI to Cash.

Once a customer chooses to make payment through the SabPaisa platform, he/she is guided to the checkout page with UPI as one of the prominent options for payment. In the next step, the customer has to enter the Virtual Payment Address (VPA) to initiate the transaction.

On the whole, UPI continues to rule the roost with its simple yet innovative features. From direct bank to bank transactions to AudioQR based payments (in Google Tez), UPI gives you the option of performing hassle-free payments. Further, with UPI platforms like SabPaisa, you can realize the potential of online cum offline payments.

References:

For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date. Learn more about SabPaisa here: https://sabpaisa.in

 

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Banking digital payments fintech

Learn the predictions for UPI payments in 2020

What bodes well for the future of UPI?

Crisil’s research shows that digital payments in India seem to grow at a CAGR of 12.7% and may jump to Rs. 4,055 lakh crore in FY24 with a five-year CAGR of 20%. Also, prediction shows that UPI payments will dominate the payments space with 59% payment transactions.

Since its inception in 2016, UPI has been making strides in the payments sector in India. With around 1.31 billion transactions in December 2019, it has become one of the sought after payments platform in India.

Future of UPI Payments

At this juncture, it is imperative to learn the future predictions for the UPI payments system. In the course of this blog, let us learn more about the future of the UPI payments system.

1. International launch of UPI Payments in Singapore

The pilot demo of BHIM UPI took place in Singapore in November 2019. It demonstrated a perfect collaboration between the National Payments Corporation of India (NPCI) and Network for Electronic Transfers (NETS) of Singapore. The project is expected to go live by February 2020. Interestingly, this is the first step in internationalizing UPI payments.

The QR code would allow anyone with the BHIM App to make online payments across the payment terminals in Singapore. Further, the international launch comes to the aid of businesses to seamlessly import and export across the borders.

2. UPI Payments-Artificial intelligence link

Artificial intelligence will determine the success of UPI based payments in the future. For example, AI can seamlessly incorporate the auto-debit payment feature. This removes the hassle of remembering the money transfer leading to efficient and effective payment transfer. Also, the chances of human errors get reduced to a minimum.

Further, the use of Artificial Intelligence in the digital payments domain eases the compliance requirements by automating the process. Automation goes a long way easing the process and standards associated with the UPI.

3. Increasing merchant transactions on UPI

UPI has become a major mode of payments not just in the Tier I cities, but also in the Tier II and Tier III cities. For example, roadside tea vendors provide a UPI payment platform in addition to the cash payment system. Small Kirana shops have started implementing UPI based payments on an extensive scale. Be it hotel bill payments or college admissions, it is here to increase the merchant transactions.

4. UPI-Credit card linkage

At present, UPI supports payment through wallets, debit cards, and net banking. Credit card functionality is not made universal. Apps like Phonepe has enabled it on their platform. Going ahead, the credit card feature will be made functional on the different payment applications.

On the whole, the future of UPI looks bright and prospective. We may not be in for a surprise if UPI turns out to be the first preference for all the transactions done in India.

References:


For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date. Learn more about SabPaisa here:https://sabpaisa.in

 

 

Categories
Banking digital payments fintech mobile wallets

The UPI vs Wallets war: Who is the winner?

Choose the best payments platform for your business

Recent research suggests that between 2021-22 & 2024-25, UPI will dominate payments space with 59% payment transactions. Interestingly, UPI clocked a whopping 1.31 billion transactions in December 2019. Further, UPI has been dethroning popular payments medium like Wallets, Digital Cards, etc. In other words, UPI vs Wallets debate is a reality.

From the non-requirement of an intermediary to safe and secure transactions, UPI differs from wallets on a number of aspects.

UPI vs Wallets

In the course of this blog, let us learn the crucial differences between UPI and Wallets.

UPI vs Wallets Difference 1: Intermediary involvement/ Money Source

In the case of wallets, money is transferred from the sender’s wallet to the receiver’s wallet. The user has to load money from their respective bank account to the wallet before making a payment. Hence, the wallet acts as the intermediary in the money transfer between individuals. It involves a complex transaction process.

On the other hand, UPI involves direct bank to bank money transfer. There is no involvement of an intermediary, thereby reducing the complex wallet loading step. Hence, you can make the funds transfer with a single step.

UPI vs Wallets Difference 2: Account Identity

In the case of the wallet, the mobile number is the account identification entity. Before you make a transaction, the identity of the sender and the receiver is verified by the wallet application.

Contrarily, in the case of UPI, the VPA (Virtual Payment Address) acts as the payment identifier. It takes the form of:

ex: ******@ (application customised name) -> [email protected]

UPI vs Wallets Difference 3: Interoperability

In the case of wallets, the sender and the receiver have to be registered with the same wallet app to make a transaction. For example, if the sender uses a Paytm wallet, the receiver should have the Paytm wallet to receive the money.

In comparison, the UPI transaction takes place between any two bank accounts, irrespective of the UPI application used to make the transaction. For example, using Google Pay, a sender can transfer money to a receiver who has Phonepe installed on his phone ( using his Phonepe VPA ).

UPI vs Wallets Difference 4: Transaction Limit

Wallets come with a low transaction limit. For example, for non-KYC customers, the transaction limit is 10k/month. And for KYC customers, the transaction limit is 20k/month.

On the other hand, for UPI transactions, there is a limit of 1 lakh transactions/day. However, the upper limit varies from bank to bank, i.e, from 10k to 1 lakh.

UPI vs Wallets Difference 5: Safety

UPI provides a platform for a safe and secure transaction. In other words, every UPI transaction happens with a 4 or 6 digit M-PIN (mobile pin). The MPIN is set up during the initial registration on the UPI App.

Comparatively, there is a chance of security compromise in the case of wallets due to the indirect involvement of the bank. It is basically a wallet to wallet money transfer.

Summary:

Top 5 differences between UPI and Wallets

  1. UPI comes with the direct bank to bank transfer while wallet transactions involve payments from one wallet to another with the indirect involvement of the bank.
  2. The wallet makes use of the mobile number for account identity while UPI makes use of the VPA.
  3. The UPI transfer happens between 2 bank accounts irrespective of the type of UPI app use whereas wallet transfer requires the installation of the same wallet app for money transfer.
  4. UPI transaction limit is 1 lakh per transaction while the wallet transaction is limited to 10k/month for non-KYC customers.
  5. UPI transaction requires an MPIN while wallet transaction may or may not involve an OTP.

Further reading:

For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date. Learn more about SabPaisa here:https://sabpaisa.in

 

 

 

Categories
digital payments fintech payment gateway

If you love UPI, you must love these 4 institutions more

Know these institutions to learn more about UPI

Introduced in the year 2016, UPI has positively altered the payments ecosystem in the country by bringing in a wave of digitization. UPI simplifies transactions by making use of the VPA (virtual payment address). It avoids the complex credential entry while making card transactions. Secondly, with the launch of UPI 2.0, features like QR & Signed Intent and Invoice in the inbox has scaled up the UPI security. Behind the success of UPI lies the efforts of numerous UPI institutions like NPCI, RBI (Central Bank), other banks, etc who manage the seamless functioning of the UPI system.

UPI institution

In the course of the blog, let us learn more about the UPI institutions that ensure a safe and secure transfer of your money.

UPI Institution 1: NPCI (National Payments Corporation of India)

National Payments Corporation of India is an organization dealing with retail payments and settlements in India. It is an initiative of the RBI and the Indian Banks’ Association, set up in 2008. The  State Bank of India, Punjab National Bank, Canara Bank, Bank of Baroda, Union Bank of India, Bank of India, ICICI Bank, HDFC Bank, and Citibank are the ten core promoter banks of NPCI.

The core payment products offered by NPCI are:

  • Rupay
  • Bhim
  • UPI
  • NACH
  • Immediate Payment Service
  • AEPS
  • Bharat Bill Payment System
  • BharatQR

UPI is one of the flagship product developed by NPCI. Introduced in 2016, UPI is a safe and secure medium for payment transfers. With UPI 2.0, new security features like Invoice in the inbox and Signed Intent & QR has enhanced the outreach of UPI.

UPI Institution 2: RBI

RBI is the apex bank of India supervising all the public, private, rural and cooperative banks in India. In other words, RBI sets the monetary policy in India in commensuration with the fiscal policy. 

Established under the RBI Act, 1964, RBI has its headquarters at Mumbai. The regional centers spread across the four zones are North in New Delhi, West in Mumbai, South in Chennai and East in Kolkata.

The Central Board of Directors is the major decision making of the RBI. The Board is headed by a Governor and not more than four Deputy Governors.

UPI Institution 3: UIDAI

The Unique Identification Authority of India is a statutory body responsible for the implementation of the Aadhaar based payments system in the country. It was established under the provisions of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016.

UIDAI issues the Adhaar number to all the residents of the country. Aadhaar number is a 12 digit unique identification number for the Indian residents.

Aadhaar is a multi-purpose card used as an ID card to avail voter’s Id, mobile connection, driving license, etc.

UPI Institution 4: UPI App Service Provider

There are many service providers who have enabled UPI on their app. For example, some of the famous service providers are GooglePay, Phonepe, Paytm, etc. Each service provider offers unique and customized UI features to use UPI services.

On the whole, the successful UPI transaction depends on the successful collaboration and interoperability between all the above-mentioned organizations. 

References:

For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date. Learn more about SabPaisa here:https://sabpaisa.in

Categories
Banking digital payments fintech

How to make UPI fund transfer? These 5 awesome channels should not be missed

Best channels for UPI transaction

Are you facing payment issues while making cash payments? But, are you struggling to choose between the best digital alternative? Don’t worry, UPI channels are here to your rescue. Introduced in the year 2016, UPI has positively altered the payments ecosystem in the country by bringing in a wave of digitization.

UPI’s popularity stems from many factors. Firstly, UPI simplifies transactions by making use of the VPA (virtual payment address). It avoids the complex credential entry while making card transactions. Secondly, with the launch of UPI 2.0, features like QR & Signed Intent and Invoice in the inbox has scaled up the UPI security.

UPI Channels

 

In the course of the blog, let us learn the different channels for making a UPI transaction.

UPI Channel 1: Through VPA (Virtual Payment Address)

Money transfer through the VPA is the elementary method of transferring money through the UPI platform. VPA stands for Virtual Payment Address. It is a unique identifier that is required to map the payee details before initiating a financial transaction. A single identifier reduces the tedious task of entering bank details like bank account number, CVV, etc.

VPA format: User-defined [email protected]/service provider

Ex: [email protected] or [email protected]

UPI Channel 2: Account number + IFSC

Money transfer through the Account number + IFSC  is the secondary method of transferring money through the UPI platform. In case you are not aware of the payee’s VPA, you can still make the payment by making use of the account number and the IFSC combination.

The account number is the 12 digit number of the payee’s bank. IFSC code is the 11 digit alphanumeric number provided by the RBI for accurate identification of banks in India.

In your UPI app, search for the Bank Transfer option. A window to enter the Account number and IFSC opens up. After the verification of the payee, you can start making the money transfer.

UPI Channel 3: Mobile Number + MMID

Money transfer through mobile number verification is the third method to do UPI money transfers. It comes with the advantage of filtering out fraudulent numbers in the first go. You can be assured that your money reaches the right destination.

To transfer money through mobile number, open the Phone number tab on any UPI app. Enter the payee’s mobile number. You get a ‘payee verified’ or ‘payee not verified’ message to proceed with your transaction.

UPI Channel 4: Aadhaar Number

If you are not able to make transactions using the above 3 methods, you can use the Aadhaar method to make a UPI transaction. But, this feature is not available on all the UPI apps.

On the Aadhaar number enabled UPI app, go to the send money option. From there, select the Send Money/ Payee address type option. Select Aadhaar number from the dropdown. Subsequently, key in the Aadhaar number of the payee before making the transactions.

UPI Channel 5: Collect/ Pull Money basis VPA

Using UPI, you can send as well as request money from your acquaintances. This feature keeps a track of the money owed to you by your peers.

To access this UPI channel, go to the Collect Money option in your UPI App. Enter the VPA address of the payee along with the collection amount. Also, there is an option to enter the time when you want to collect the amount.

 

 

References:

 

For more blogs, visit https://blog.sabpaisa.in

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date. Learn more about SabPaisa here:https://sabpaisa.in

 

 

Categories
Banking digital payments fintech

SabPaisa Awards and Mentions

Our good work continues to be recognized

DECEMBER – QUARTER 2

INDIAN ACHIEVERS’ AWARD BY INDIAN ACHIEVERS’ FORUM

Our beloved CEO, Kumar Manish has been conferred with the “INDIAN ACHIEVERS’ AWARD” for Business Excellence by the INDIAN ACHIEVERS’ FORUM.

His vision and farsightedness have been the pillar of strength of our organization. We wish him best wishes for all his future endeavors. May his valuable contribution to the economy continue to touch lives in the days to come.

Facebook link: https://linkpaisa.in/QVvL

Instagram link: https://www.instagram.com/p/B9oF7cJnrZS/

For more blogs, visit SabPaisa Blog

YOU ARE READING THE ARTICLE COURTESY: SabPaisa (SRS Live Technologies) – headquartered in New Delhi with eight regional offices including Mumbai, Bangalore & Kolkata – is a rapidly growing Fintech company having developed one of India’s most advanced AI-driven recurring payments platform bolstered by another of SabPaisa’s unique products: world’s first hybrid payment platform which has all the payment modes in a single checkout page, online and offline, from UPI to Cards to e-NEFT to e-Cash. Businesses that take SabPaisa’s payment gateway get real-time reconciliation and consolidated reports for all payments, recurring or one-time, online or offline, in a single dashboard, whether the payer is an 18-year-old in Kashmir paying through UPI or a 70 year paying through Cash in Kanyakumari. SabPaisa’s payments and collection application suite have already processed more than INR 12 Billion to date. Learn more about SabPaisa here: https://sabpaisa.in