Abstract
This paper studies Unified Payment Interface (UPI), a new age payment system introduced in India by National Payment Corporation of India. Unified Payment Interface is a mobile centric, real time interbank payment system which has the potential to transform and universalize digital payments in India. The paper traces the evolution of payments systems in India and examines in detail the technology behind Unified Payment Interface focusing on its architecture and security systems through empirical and theoretical literature review. UPI is a significant advancement as compared to extant payment system in terms of cost, ease of use for consumers, settlement times and security and has witnessed good user adoption. Its modular API based architecture will enable development of innovative solutions for consumers and businesses. UPI is currently in its infancy stage and development of merchant centric UPI solutions will greatly increase the user adoption. UPI can help bring a large part of the population within the ambit of digital economy and can be a great tool for financial inclusion in India.
Highlights
India is the seventh largest economy of the world with GDP of USD $ 2.3 trillion [1], for an economy of this size India is predominantly cash driven economy
This paper studies Unified Payment Interface (UPI), a new age payment system introduced in India by National Payment Corporation of India
1184 American Journal of Industrial and Business Management e) The Card details and OTP is authenticated by the Issuer Bank and UPI PSP application sends this MPIN to National Payment Corporation of India (NPCI) which in turn send it to Issuer bank by encrypting it with the public key using PKI
Summary
India is the seventh largest economy of the world with GDP of USD $ 2.3 trillion [1], for an economy of this size India is predominantly cash driven economy. R. Gochhwal notes, use of fake currency and most importantly lack of trail of transactions which leads to tax evasion. Use of fake currency and most importantly lack of trail of transactions which leads to tax evasion These problems are bound to be amplified as the economy grows. UPI leverages high teledensity in India to make mobile phone as a primary payment device for both consumers and merchants and to universalize digital payments in the country. India currently has inadequate digital payment acceptance infrastructure for merchants and merchant centric UPI solutions have the potential to fill this gap in a cost effective manner. UPI can be case study for both developing and developed countries to enable universal, low cost digital payment system
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