UPI 2.0: Here’s what you need to know

• Unified Payments Interface (UPI) 2.0, India’s cashless payment interface, was launched by the National Payments Corporation of India on Thursday.
• It’s an update to the original UPI platform that the Indian government launched back in January 2016.
  
• The update will be rolled out to users through the interface’s 11 partner banks.

India’s public cashless payment platform, the Unified Payments Interface (UPI), announced the rollout of UPI 2.0 on Thursday. While the country’s central bank, the Reserve Bank of India (RBI) facilitated with the development of the app, the National Payments Corporation of India (NPCI) is the organisation in-charge of retail payments in the country.

The primary function of the UPI app is to serve as the middle-man for around-the-clock money transfers from one bank account to another without having to disclose the beneficiary’s bank account details.

Having been in the works for nearly six months, the updated version has features that add to the authenticity of payments while others contribute towards added convenience. Here are some changes to watch out for:

1. No more mismatch between payment requests and actual billing

The original UPI platform, while having its merits, ran into a bit of a snag when there were complaints of actual bills on matching payment requests. UPI 2.0 attempts to solve that problem by adding the bill to the payment request itself. Users can verify the invoice and cross-check the vendor’s credentials before making the actual payment.

2. Verified QR code
In the past, there have been a few instances of QR code tampering where customers have made payments, but rather than it going to the vendor, the payments end up in a fraudulent account. What UPI 2.0 has put in place allows customers to check whether or not a particular merchant is verified, and in case they’re not, the user will get a notification to alert of possible fraud.


3. One time mandates
One time mandates are like the post-paid for merchant payments. Within the new interface, users can pre-authorise a payment that will be executed at a later date as specified. It works both ways, for consumers and merchants alike.

4. Overdraft account
In the past, users could only link their current and savings accounts to the app. But, UPI 2.0 allows for overdraft accounts as well. Not just in a filtered way, but with full bells and whistles that are associated with overdraft accounts.

Using Immediate Payments Service (IMPS), the UPI process can be thought of like an email ID for making payments. Being faster than NEFT and without the time constraints, UPI is essentially an advanced version of the IMPS. It cuts down on costs and the effort associated with making payments.

Just as UPI was a push towards enhancing the digital payments culture in India, UPI 2.0 looks to encourage that even further. That being said, the adoption of cashless payments, though on the rise, shows the disparity in its penetration across the country.