In today’s highly automated society, most people prefer to send and receive their financial transactions digitally. There are a variety of techniques to complete these cashless exchanges.
The UPI transaction is one of the most practical options.
India has taken the first step toward fully cashless transactions with the introduction of UPI, aka Unified Payment Interface. Smart phones make this approach simple and quick to implement. UPI allows instantaneous interbank fund transfers.
In contrast, a simple UPI PIN is all that’s required to complete this transaction, rather than your actual bank account information. It’s a paperless transaction.
UPI Payment is built on the IMPS infrastructure. The UPI makes it possible to send funds to other account in the world. Transferring funds between accounts is quick, easy, and secure. You can use the funds in either account immediately.
Also, doing so is a breeze. You just need one UPI ID because the recipient’s name and the amount of the transfer will appear next to it. Money can be sent there if you need to cancel, and it will be straightforward to utilize once you do.
In India, users can choose from a variety of UPI apps like paytm,Google Pay, PhonePe, & Fi Money. All of these services provide cost-free transaction processing, so you won’t have to worry about any hidden fees when making a payment.
Advantages of UPI Transaction
Here are some of the best benefits of using UPI
1. Secure payment
The first advantage of UPI payment is security. You can perform the safest transaction possible by using the Unified Payments Interface (UPI) without ever disclosing your UPI PIN. This method of transferring funds is extremely secure because it only requires you to remember one PIN.
2. 24 x 7 availability
With UPI, mobile phone users may send and receive money instantly. 24X7.
3. Convenience
The ease of use is one of the most appealing features of UPI for consumers. Only with a few clicks, a transaction can be finalized in a matter of seconds. You can forget about bringing cash with you or making a trip to the bank.
UPI also helps people because it doesn’t require them to use an unsecured website to handle their financial transactions. A safe payment gateway is used for all transactions.
4. Zero charges
All UPI payments are free of charge because to the generous support of the Indian government. Whereas similar payments made through IMPS or NEFT incur a small fee, UPI transactions are tax-free. You can conduct monetary transactions at no cost to you.
5. Simple interface
With the assistance of the UPI payment, sending money to another person’s bank account is a breeze. To send money to another UPI user, all you need is their UPI id, which you can get by asking them for their UPI pin, and the amount, both of which you may enter into the UPI support app.
6. Real time payment
The major benefit of the UPI is that you can send or request any payment at once. In a matter of seconds, the funds will be deposited into your account or transferred to another.
7. Supports maximum bank
Almost every financial institution can work with UPI. SBI, PNB and any other bank that supports the Unified Payments Interface can receive payments quickly, simply, and at no cost.
8. Coupon and cash back offers
There are many advantages to using the UPI to send money to the other account holder, including the possibility of receiving cash back. The UPI-supporting app, like Google Free Recharge for Android or iOS, or any other UPI-supporting app offers cash back or rewards on transferring funds or making a payment to any vendor through the UPI app.
Disadvantages of UPI Transaction
The UPI payment is straightforward and accurate, but it does come with a few drawbacks that we have detailed below for your information.
1. Allows small amount of transfers
While UPI is a great option for sending little sums of money, larger payments are better handled through alternative online payment systems.
2. Mobile may hang
The UPI support app must be installed on your smart phone and only then can be used to make payments. There is no web browser access available for this app. Your mobile device might hang and also consumes too much data.
3. Dependency on smartphones
In order to complete a UPI transaction, the user must have access to both a smart phone and the internet. This can be problematic for those who do not have access to smart phones or the internet. Furthermore, customers may experience issues using their UPI accounts & completing transactions if they lose or damage their phones.
4. Server issue
While UPI is a speedy and secure method of payment, it can take a while to process after a server outage at the receiving bank.
Like any other software, UPI systems might have downtime or technical issues. Online customers may become irritated if tech maintenance is performed without warning or during peak shopping hours.
5. Online fraud
Cyber criminals are adapting to the growing trend of individuals making and preferring online payments over more conventional ones.
More and more people fall victim to identity theft, phishing scams, and database breaches. Businesses spend a lot of money on payment-security software to protect themselves from these threats and boost security.
Thus, never share your UPI pin with anyone, this can keep you secure and protect against online fraud.
6. Technological illiteracy
The fact that many people, particularly the elderly, are technologically illiterate is a major drawback to UPI online payment systems. They don’t feel confident making purchases online due to a lack of understanding on how to use technology or devices.
Many people avoid using electronic payment systems because they find them too complicated. This is particularly problematic in economies in transition, such as India’s.
Conclusion
In general, UPI has changed the way of money transfer in India by making it safer and cheaper than previous approaches. The use of UPI has many advantages as mentioned above.
Nevertheless, not all payment options are created equal, and you’ll want to weigh the pros and downsides before settling on one.
Consumers may make more well-informed selections about which payment method is ideal for them if they are aware of the benefits and drawbacks of UPI for payments.
