India is a country with very minimal or weak financial penetration. 70% of the Indian population resides in towns and villages. Due to a lack of literacy and awareness, most people have limited or zero financial knowledge.
However, the above scenario took a complete turn with the introduction of the Unified Payments Interface (UPI). Before the introduction of UPI, the dream of Digital India and Digital Banking was unreal. But, with the turn of events, India is heading speedily toward other aspects of Digital Banking.
What is UPI?
Unified Payments Interface is an instant payment system developed by the National Payments Corporation of India (NPCI). It is the most widely used payment system in India now, which simulates instant gratification. The UPI system is regulated by the Reserve Bank of India (RBI).
UPI payments operate around inter-bank Peer-to-Peer (P2P) and Person-to-Merchant (P2M) money transfers. The interface is operable on mobile phones, and the mobile number must be registered with the relevant bank to proceed with the transactions.
What is UPI 2.0?
UPI 2.0 is the upgraded version of the Unified Payments Interface. It is equivalent to the GenZ generation of the world as it has united different merchant payments and banking features in a single platform.
UPI 2.0 was launched in 2016. The upgraded version of the Unified Payments Interface has many applications and benefits in the financial world.
The introduction of UPI was revolutionary for the country; hence the developers launched UPI 2.0 to reach the top-most summit of financial transactions with greater accessibility and ease.
Benefits of UPI 2.0
Here are some fantastic benefits of UPI 2.0:
Access to Link Overdraft Account
- UPI 2.0 provides access to customers to link their overdraft accounts along with their current and savings accounts.
- The above feature allows customers to make transactions instantly and enjoy all the additional benefits of an overdraft account.
- UPI 2.0 is an extra digital platform for customers to access their overdraft accounts.
- UPI mandates are beneficial when financial transactions are made later by providing a commitment in the current scenario.
- UPI 2.0 mandates are created with one-time block functionality for transactions.
- Customers can pre-authorize a transaction and pay at a later date.
- The one-time mandate option of UPI 2.0 is functional for both merchants and individual users and is a significant financial instrument for both parties.
- However, UPI mandates can be created and executed instantly. The committed amount will be transferred by the merchants or individual users on the day of purchase.
Invoice in the inbox
- According to NPCI, the invoice feature is designed for customers to check the invoice sent by the merchants before making payment.
- It is a form of security feature that will enable customers to verify the merchant credentials and check the authenticity of the merchant.
- Customers can easily make the scheduled payment after verifying the amount and other important details mentioned in the invoice.
Signed intent and QR
- With the increase in fake QR codes all over the country, the above feature is of great help to customers.
- The signed intent feature enables the customers to verify the authenticity of merchants while scanning QR.
- After the customer scans the QR code of the merchant, the app immediately notifies the user with information on whether the merchant is a verified UPI merchant or t additional security is added to reduce cyber crimes and fraud.
- If a specific merchant is not authorized, customers will be informed that the transaction is not secured through notifications. In this way, customers can avoid unforeseen circumstances.
UPI 2.0 is an incredible financial instrument in India. Compared to the original UPI version, UPI 2.0 has done wonders for the lives of people in India. It has also contributed towards more financial penetration in the remote places of India, and Tier 2 cities in India are also readily using the UPI 2.0 services on available applications. UPI has changed the game of finance in India. Financial inclusion is one of the significant achievements of the Unified Payments Interface, especially at the grass-root level in the country.