Demystifying UPI — All you need to know

Each one of you would have faced a situation similar to what Joey, Rachel & Phoebe go through in the ‘The one with five steaks and one eggplant’ episode, where they face financial problems due to which they ask Chandler & co to split the restaurant bill.

Dinner where Everyone owes 28 bucks

What if I told you that there was a way to split bills without any embarrassment, hassle and usage of cash, and that offers instant settlement to your bank account!

Post demonetization, a lot has been said about making India a less-cash Economy. With the aim of promoting electronic transactions in the country, the National Payments Corporation of India (under the umbrella of the Reserve Bank of India) has launched UPI and BHIM (a UPI App). UPI is a solution that makes peer-to-peer transfers effortless and instant.

We, at Myntra, are proud to launch UPI as a payment option. You can now use UPI to make purchases on Myntra.

What is UPI ?

In layman terms, UPI is an electronic payment method similar to Internet banking, Credit card, Debit card or NEFT. UPI is to electronic payments, what Instant-messaging was to Email. It is a layer built on top of IMPS. For starters, IMPS is an instant money transfer mechanism. Almost all the banks have launched UPI Mobile Applications (both iOS & Android).

UPI is to electronic payments, what Instant-messaging was to Email.

How to use UPI ?

1. Sign-up on any of the 32 UPI enabled Apps launched by Banks. For example, PhonePe is a UPI App powered by Yes Bank.
2. Create a Payment Address and associate it with your bank account. Let’s say shrenik@ybl
3. Now you can use this Payment Address to transact via UPI
4. You can push/pull payments from third party irrespective of their bank. All you need is their Payment Address.
5. Enter the m-Pin every time you want to authorize a transaction.

Why UPI ?

1. Single Payment solution: UPI has the power to become a single payment solution in India. Be it offline payments or online shopping. Your Bank Account itself acts as a wallet and it saves you the trouble of maintaining 25 different wallets.
2. Fast: UPI transactions are settled in near real-time unlike Cards (Credit card & Debit card) whose settlement takes around 7–10 days. You can use UPI for all peer-peer transfers like settlement between friends, paying landlord etc. It also means that the refunds processed by merchants (like Myntra, Flipkart etc) will be reflected instantly.
3. Convenient: You don’t have to remember or share your Account details like A/c number, Branch IFSC code, Branch name etc. Just share your Payment Address and transact. Similarly, you don’t have to enter your card details (which is quite cumbersome) every time you want to make an online transaction.
4. Secure: UPI is as secure as any electronic transaction can be. It uses 2-Factor Authentication as mandated by RBI. Your device along with Phone number acts as first authentication factor and the m-Pin acts as the second authentication factor.
5. Interoperable: UPI’s 4-party model gives you interoperability. Apart from the flexibility to transfer money to any bank account irrespective of its bank, you can also choose any of the UPI Apps and link all your Bank Accounts to a single Payment Address. At the time of writing this article, 39 banks are LIVE with UPI. The only major bank absent on UPI is Citi Bank.
6. 24/7 Available: Just like IMPS, UPI is available 24/7. You can use UPI to transfer money even on bank holidays.
7. Interest: Last but not the least, your money stays safe in your bank account. You don’t lose out on any interest by keeping it in let’s say Wallets.

Below are the steps to place an order on Myntra(Android) using UPI:

It is that simple! You just need to enter an mPin. Forget entering card details, OTP or username/password in case of internet banking.

P.S: You’ll realize the true potential of UPI once you cancel a just placed order. The refund will be instantaneously processed to your bank account! Try UPI, you’ll love it.