Focus: GS III: Indian Economy
Why in News?
The Prime Minister has lauded fellow Indians for embracing digital payments as India reached a milestone of 782 Crore UPI Transactions worth ₹12.8 Lakh Crore in Dec 2022.
What is Unified Payments Interface (UPI)?
- Unified Payments Interface (UPI) is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing & merchant payments into one hood.
- UPI, which was introduced in 2016, has become one of the most used digital payments platforms in the country.
- The volume of UPI transactions has already reached ₹76 lakh crore in the current year, compared to ₹41 lakh crore in FY21 ,
- Advantages of UPI Includes – Immediate money transfer through mobile device round the clock 24*7 and 365 days.
- UPI Enables Single mobile application for accessing different bank accounts with Single Click 2 Factor Authentication – Aligned with the Regulatory guidelines yet provides for a very strong feature of seamless single click payment.
- It also features Virtual address of the customer for Pull & Push providing for incremental security with the customer not required to enter the details such as Card no, Account number; IFSC etc.
National Payments Corporation of India
- National Payments Corporation of India (NPCI), an umbrella organisation for operating retail payments and settlement systems in India, is an initiative of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007.
- It is a “Not for Profit” Company under the provisions of Section 25 of Companies Act 1956 (now Section 8 of Companies Act 2013), with an intention to provide infrastructure to the entire Banking system in India for physical as well as electronic payment and settlement systems.