RBI launches UPI; money transfer now as simple as a text message

It is a payment system that will allow you to use a mobile phone to make money transfers. A virtual debit card, if you will.

For starters, the customer needs to have a bank account to make payments. That done, she will need to download an app on her smartphone. She can start making payments. It is as simple as sending a text message.

Every bank requires you to download its app. So, if you have two bank accounts, you will find yourself needing two apps on your smartphone. But, with this interface, the customer needs to dowloand only one app. The UPI interface will network all the banks together and make it possible for the customer to make her transactions using a single app.

Very much so. The customer will be given a virtual ID and won’t have to disclose her bank details. Of course, she will have to authenticate her ID with a password.

If it is an overseas transaction, you will be allowed to use your mobile or Aadhaar numbers as your ID. For local purposes, a virtual address will do.

If you buy a product from Flipkart using your smartphone, you will have to give your virtual address, and the company or merchant will request money from it. Once you key in your username and password – without having to go into your bank details – the transaction will have been made.Compiled by Karthik Krishnan