NEW DELHI: The government-backed Unified Payments Interface (UPI), a system that allows money to be transferred between bank accounts through smartphones, could rope in as many as 10-15 ecommerce merchants in a big upgrade to enable people to seamlessly pay for online shopping.
“In the next one or two months, a sizeable number of ecommerce merchants will go live on UPI. That’s what our effort is. At least 10-15 merchants will be going live so that we can get good traffic,” Dilip Asbe, Chief Operating Officer of the National Payments Corporation of India (NPCI), told ET. He did not identify the ecommerce companies, saying banks are in talks with them.
So far, person-to-person transactions are taking place on the UPI platform, which was launched by NPCI and the Reserve Bank of India on August 25, with the participation of 21 banks.
The COO said UPI had been working with a couple of wallet providers so that the platform can be used for wallet top-ups. “Wallets should get benefit from UPI,” Asbe said. He added customers would use both UPI and wallets. “One segment wants to do fund transfer from bank account – that segment will rely on UPI. There will be people who want to use wallets for cash-back and attractive offers from merchants – they will use wallets,” Asbe said. One benefit that UPI offers customers is the ability to have multiple virtual addresses for accounts in various banks.
ET View: Revolutionary
The PMO’s push makes sense. The goal of UPI is to foster financial inclusion and use technology to improve the quality of life. UPI allows people transfer money from their accounts instantly to another bank account linked to a smartphone. The advantages include its open architecture and flexible user interface. Data connectivity has to be good. To enable rural massess to use UPI, India should lower the price of spectrum. Of course, online wallets can co-exist.