One can use UPI app instead of paying cash on delivery on receipt of product from online shopping websites and can carry out miscellaneous expenses like paying utility bills, over- the-counter payments, donations and school fees, among others. For instance, when you are making a purchase on a portal by using you virtual ID after selecting UPI as the payment mode, a pop-up or push notification is received on your payment service provider (PSP) app requesting for a confirmation of the payment.
All you need is to then simply enter your secure pin to authenticate the purchase transaction and within seconds you receive a confirmation of a successful online purchase from the merchant. When you create a virtual ID or address as part of your registration process with the PSP, you reach the payment section on the merchant site post adding goods to your shopping cart and select UPI as the payment mode You are only required to enter your virtual ID to proceed and nothing else.
When the transaction request hits the merchant’s server, it is immediately passed on to the acquiring bank’s server where a UPI collect transaction is initiated on the virtual ID shared by you from the merchant’s server. This request is then routed to the UPI server and using your virtual ID the transaction request is directed towards your PSP app. A pop up appears on the app screen requesting for the secured pin.
You authenticate the transaction request and the transaction proceeds to the UPI system where the actual account details are fetched up against the mapped virtual ID.
This transaction is then pushed to your bank account, where the credentials are validated and your account is debited. The confirmation is again pushed back to the UPI servers and in turn it initiates a credit message to the merchant’s acquiring bank and credit to the merchant happens in real time. You can use UPI in merchant establishments, online payments, utility bill and school fees payments and even appbased taxi hailing services.
You can also pay-by-date: you can set future payments depending on the last date without missing on payments on your insurance or even phone bills.
Likewise, in case of recurring payments for which you may be using the ECS (electronic cash payments) such as utility bills, school fees or mobile bills, you can do so with a one-time secure authentication and rule-based access. Organisations could use this to even pay salaries.