Complete Details and Step by Step Guidance on How to Use Unified Payment Interface (UPI) for Money Transfer!

‘Digital India’ is the next big revolution as the government is rapidly working toward providing internet to the remotest of villages, & connecting them to the fast-paced tech-savvy life of the 21st century. This is bound to witness a massive boost as more & more people are moving toward digital payments since the demonetisation. The bedrock of this change will be the Unified Payment Interface (UPI) system.

What is UPI?

  • It is an online platform for transactions launched by the RBI & National Payments Corporation of India (NPCI).
  • It allows transfer of money between two bank accounts.
  • Payments can be made from bank accounts to merchant bankers as well without the hassles of typing account/card details.

Uses & Features of UPI

  • Immediate money transfers around the clock
  • Single mobile application for accessing different bank accounts
  • Virtual address of the customer for ‘Pull & Push’ provides for incremental security as the customer is not required to enter the details such as card number, account number, etc.
  • Merchant payment with Single Application or In-App Payments
  • Utility bill payments, Over the Counter payments, barcode (scan &pay) based payments
  • Donations, collections, disbursements scalable

Other Information on UPI

  • It is safe as customers only share a virtual address & provide no other sensitive information
  • The per transaction limit is Rs. 1 lakh
  • NCPI has indicated that they will charge Rs. 0.50 per transaction &it will appear as IMPS transaction charge on your bank statement

How to Download & Transact (Example shown on Flipkart’s PhonePe UPI app)

  • Step 1 – Search for UPI apps in App Store & download any. You can search by entering your bank name & then typing UPI (for ex – ICICI UPI). There are 28 different apps on Google Play.

  • Step 2 – You will have to verify your number. Also one should install the app on the number which is linked with the bank account.

After the verification you’ll need to enter some basic details like name & email (which will help you recover the 4 digit pin in case you forget it), & set a 4 digit pin.

  • Step 3 – Next is adding VPAs (Virtual password address). Click on your number in the menu to go to your profile. Search for the ‘Add VPA’ link & add a VPA. Other people will use this VPA to send you money. Keep the VPA simple so it can be easily remembered ([email protected] is an example of a VPA).

  • Step 4 – Now to adding a bank. Swipe left to right. Go to Bank Accounts menu & press Add Bank Account button. Then select your bank. Your bank account linked with your phone number will be added without you needing to enter anything such as account number. You can add more than one account if you have multiple bank accounts linked to the same number.
  • Step 5 (Transacting) – Go to app home & click send.


  • Step 6 – Go to VPAs & click add VPA contact. After you enter a VPA, you have to click verify button & it will verify if VPA is valid &also show registered name of the recipient.

  • Step 7 – Now enter the amount that you’d wish to send & from which bank account. Next you’ll have to enter the MPIN associated with the bank account, & done! All this takes less than a minute.

The government should also make sure that all banks have properly funtioning apps that are developed in a consumer-friendly manner in a variety of languages.

This system can transform the manner in which payments are made & received. It is easy, safe, & very convenient to use once a user inculcates the habit of transacting digitally.

Photo credits and explanation: OpIndia.

Vinayak Jain