How to use QR codes and UPI AutoPay to make recurring payments

A user can register for the UPI AutoPay mandate from a merchant’s website as well as from the UPI app she uses.

There are times when we forget to pay our insurance premiums, utility and OTT bills, periodical subscriptions, etc., and end up paying late fees or having our services discontinued. Insurance policies lapse if the premium is not paid on time.

In 2020, the National Payments Corporation of India (NPCI) launched the UPI AutoPay feature, which allowed recurring payments via the Unified Payment Interface (UPI). With this, consumers started setting up auto-debit instructions on the UPI applications linked to their bank account.

Today, UPI Autopay has become a popular choice. An RBI bulletin released in June 2023 showed 143 percent year-on-year growth in successful transactions using the UPI Autopay feature.

Recently, at the Global Fintech Fest, 2023, Razorpay, in collaboration with NPCI, launched UPI Autopay on QR, an innovative solution set to redefine AutoPay.

How does one set up UPI AutoPay?

A user can register for the UPI AutoPay mandate from a merchant’s website as well as from the UPI app she uses. You need to provide the merchant’s UPI ID, frequency of payment, amount to be debited (fixed or up to a certain value), and the validity period of the recurring payments.

You will receive a notification to authorise the AutoPay request on the UPI app. You need your UPI PIN to authorise it. After your PIN is verified, you will receive a confirmation message on the registered email i.d. and mobile number from the merchant if the AutoPay setup is successful. Thereafter, payments will get processed as per the given instructions.

No charges are applicable for setting up the UPI AutoPay facility.

You can even set up auto pay from your savings account using internet banking. For instance, if you have an account with the State Bank of India (SBI), you first need to login to internet banking, click on bill payments, and select manage biller. The manage biller page displays the tabs to add, modify, and view biller details.

Using UPI AutoPay you can make recurring payments through apps like Paytm, GooglePay, PhonePe, etc.

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How does UPI AutoPay on QR streamline the recurring payment process?

With UPI AutoPay on QR, merchants gain a steady, frictionless way to receive regular payments.

After creating a QR code for their subscription offerings, businesses will be able to include them in their online, print, and TV ads, product packaging, etc. For instance, your utility biller will provide you with a UPI AutoPay QR code on the monthly bill statement sent to you in a physical format or by email.

“This will revolutionise the operations of subscription-based businesses. UPI Autopay on QR will transform customer onboarding into a swift 2-step process, involving scanning and paying in under 30 seconds,” said Khilan Haria, SVP and Head of Payments Product, Razorpay. He added that this streamlined approach replaces the previous six-step journey, eliminating the need to download an app or signing up on the website.

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What frequency of recurring payments can be set-up?

The frequency of recurring payments available is daily, weekly, fortnightly, monthly, bi-monthly, quarterly, half-yearly, and annually, or as and when presented by the merchant. These options could vary from merchant to merchant. For instance, you can set up a monthly SIP to invest in mutual funds with an asset management company, or set up half-yearly or yearly insurance premium payments.

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Benefits to users

Currently, users are required to download the merchant app or log in to a website before they can subscribe to specific offerings. For instance, if someone wishes to subscribe to a particular OTT platform, they must navigate through the entire process of visiting the platform's website or landing page, logging in with their credentials, and then making a payment after selecting their preferred payment service provider.

“Now, the QR code allows you to manage subscriptions and recurring payments, and increases the success rate by simplifying the checkout process,” Haria said.

Users do not have to remember the virtual payment address (UPI id). They can make the payments directly by scanning the QR code using any payment service provider’s app.

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What happens if I don’t have sufficient balance in my account when the recurring payment is to be made?

In such situations, your UPI AutoPay recurring payment will fail and the merchant will be informed of it. The bank will not levy any fine or penalty for not maintaining sufficient balance for the payment. If the very first AutoPay debit of a customer fails due to lack of funds, the mandate will be cancelled. For any subsequent debit failure due to insufficient funds, the mandate will not get cancelled, and subsequent debits will be attempted as per the frequency set for AutoPay.