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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

Categories
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
artificial intelligence digital payments

Five Best Applications of Artificial Intelligence In The Payments Domain

Take your business to the next level with the magic of artificial intelligence

Love the receptive chatbot upon entering a banking website? Definitely, everybody loves an ounce of handholding. Imagine, your monetary investment being automatically gauged to customize a detailed retirement plan for you. Looks amazing, isn’t it? Welcome to the amazing world of artificial intelligence.

Artificial intelligence is the replication of human intelligence of logical reasoning cum analysis, by machines. It is a popular buzzword spanning across numerous sectors like education, health, finance, cybersecurity, etc. In particular, the payments domain is witnessing a rapid stride in the use of artificial intelligence. From fraud detection to all-round customer support, artificial intelligence is the dire need of the hour.

Artificial intelligence
Prospects of artificial intelligence in the payments domain

In the duration of this blog, let’s travel to the amazing world of artificial intelligence in the payments domain.

1. Fraud detection

The banking channel is witnessing increasing levels of fraud off-late. For example, the Punjab bank crisis is a point in case. A high level of artificial intelligence intervention will keep a preventive check on the fraud. The artificial intelligence algorithm will segregate between fraud and the not so fraud transactions in the initial stages. In other words, AI will bring in better fraud monitoring cum effective decision making.

2. Better payment settlement with artificial intelligence

Were you stuck up with the thoughts of your impending payments? Or did you encounter the hassle of improper payment?  Then, artificial intelligence is the need of the hour for your brand. Be it claims settlement or insurance settlement, artificial intelligence ensures an automatic and precise payment mode. No more worry about delayed payment settlements. It will be a thing of the past.

3. Reduction in false declines

Banking channels face the constant issue of payment decline at the nth moment. It is due to multiple miscellaneous factors. Either, the network has timed out or the payment has been declined at the sender’s or receiver’s side. In either of the cases, artificial intelligence can reduce unintended human error by automating the process.

4. Predictive analysis

Predictive analysis refers to the prediction of future events using repetitive patterns, choices and decision making. From where to invest your money to analyzing the future prospect of your purchase, artificial intelligence acts as your best friend. The role of artificial intelligence in the predictive analysis is further going to increase with the enhanced dimensional applications. Bank security and national security are a point in question.

5. Faster customer service using artificial intelligence

Customer service feature using chatbots is one of the very interesting features of artificial intelligence. How do you feel when you get a prompt and quick response to your queries? Satisfying isn’t it? Further, your trust in the brand amplifies manifold. Artificial intelligence is taking the chatbot feature to a completely new level. From understanding the choice of the customer to the future decision of the customer, artificial intelligence has gone two notches high.

Chatbots have different applications in domains apart from the banking sector. For example, endurance is a chatbot designed specifically for dementia patients. It recognizes the change in memory patterns of the patient, thereby giving an alert to the family members.

 

 

 

 

 

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 Financial intermediary payment gateway Uncategorized

Banking in India explained

Service your needs through the banking institutions

Confused with the choice of a banking institution for your business? Right kind of funding is important for the health of any business. In other words, funding at the appropriate time gives more freedom for creativity and innovation. A well-funded business has more leverage for expansion and growth.

In India, we have a number of banks catering to different customers. Also, we have a mix of public and private sector banks servicing a variety of needs.

Banking institutions
Banking institutions in India to service your needs

In the course of this blog, I will walk you through the different types of banking institutions in India.

BROAD CLASSIFICATION OF BANKS

1. SCHEDULED BANKS

Scheduled banks are included in the second schedule of RBI Act,1934. By being a scheduled bank, one acquires membership of the clearinghouse. Also, the banks can get loans from RBI at the bank rate. Any bank with a capital of more than 5 lakh qualifies as a scheduled bank. Further, scheduled banks keep a cash reserve ratio with the RBI.

2. NON-SCHEDULED BANKS

Non-scheduled banks are not part of the second schedule of RBI Act,1934. The capital requirement of a non-scheduled bank is less than 5 lakhs. Non-scheduled banks are not members of the clearinghouse. Also, they do not have access to loans from RBI at the bank rate. Unlike scheduled banks, non-scheduled banks do not keep a cash reserve ratio with the RBI.

Non-scheduled banks are also called as local area banks in India. Coastal Local Area Bank Ltd, Capital Local Area Bank Ltd, Krishna Bhima Samruddhi Local Area Bank Ltd, Subhadra Local Area Bank Ltd are some of the examples.

TYPES OF SCHEDULED BANKS

1. COMMERCIAL BANKS

A commercial bank provides banking services with a profit motive. They ensure adequate credit creation and stability in a nation’s economy.

  • PUBLIC SECTOR BANKS: Public sector banks have the government as the major shareholder(more than 50%). Over 75% of the banking sector business comes under the purview of the Public sector banks. There are 12 major PSBs in India such as SBI, Bank of India, Bank of Baroda, Central Bank of India, etc. On the whole, there are 27 PSBs in India.
  • PRIVATE SECTOR BANKS: In private sector banks, non-government entities form the major shareholders. There are 22 private sector banks in India. Private sector banks provide a slightly less interest rate as compared to PSBs. Similarly, Private sector banks constitute over 15% market share in the country. Some major private sector banks in India are ICICI, HDFC, Axis, IDFC, etc.
  • FOREIGN BANKS: Foreign banks cater to the jurisdictional laws of both the parent and destination country. 1% of branch network in India constitutes foreign banks. Also, foreign banks have a Priority Sector Lending of 40% and a minimum capital requirement of 5 billion.
  • REGIONAL RURAL BANKS: Regional Rural Banks caters to the funding needs of the rural communities in India. It draws its operating and functional powers from the Regional Rural Banks Act, 1976. In addition, RRBs also cater to payments in government schemes like MGNNEGA and government pension programs. RRB has a joint shareholding of Central government(50%), State government(15%) and Sponsor Bank(35%).
  • PAYMENT BANKS: It is a new category of banks with limited functionality of a bank. For example, payments banks do not issue loans. The deposit limit is 1 lakh per customer maximum. Further, payments banks have a minimum capital of 100 crores.
  • SMALL FINANCE BANKS: Small finance banks service the needs of the small and marginal entities like small farmers, traders, businesses, etc. Small finance bank has 100 crores paid-up capital and a priority sector lending of 75%. Further, they do not lend to big corporates or groups.

2. COOPERATIVE BANKS

Cooperative banks function on the basis of cooperative principles. The ownership of cooperative banks lies with the customers. In India, cooperative bank categorization takes place on the basis of Short term and Long term lending options. Short term lending takes the form of Primary Agricultural Cooperative Societies (PACCS) at the village level, District Central Cooperative Banks at the District level and State Cooperative Bank at the State level. The long term lending is a two-tier structure with Primary Agriculture and Rural Development Banks (PARDBs) at the village level and State Agriculture and Rural Development Banks.

  • URBAN COOPERATIVE BANKS: Urban cooperative banks finances the needs of urban areas, registered under the cooperative societies act. They largely cater to small businesses in urban areas like small traders, low and middle-income groups, etc. UCB regulation happens via both the State Government and the Central bank. State government laws cater to the UCB’s administration while the central bank laws apply in case of regulation.
  • RURAL COOPERATIVE BANKS: Rural cooperative banks finances the needs of rural areas. It caters to agriculture, livestock, rural employment sector, etc.

For more blogs, visit http://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