What is UPI ID and How to Create UPI ID?

To ensure security, once you have registered your UPI ID, it is crucial to generate UPI PIN, which acts as a password for every transaction. By being well-versed with the UPI ID meaning and its functionalities, you can enhance the ease of your monetary transactions through the online mode.

In the past few years, UPI acceptance has increased owing to its efficient and secure nature. As per the data by National Payments Corporation of India (NCPI), UPI transaction has enhanced by 58%, reaching 9.96 billion in July 2023 and the value of transaction rose by 44%, showcasing its wide acceptance since its launch in 2016.

What is UPI ID?
 

UPI is a mobile-linked instant payment system that permits two parties to send funds to one another. It was formed by the NPCI and is managed by the Reserve Bank of India (RBI). A Virtual Payment Address (VPA) or the UPI ID manages UPI transactions on platforms such as mobile or desktop.

To use the UPI service, every bank account user must create a UPI ID or VPA, which aids in account tracking and transactions. Every bank in India, including IDFC FIRST Bank offers UPI service. IDFC FIRST Bank’s UPI process is fast and seamless, and it doesn’t attract any charges either. The UPI payment service offers instant fund transfers without the need to enter bank account details such as account number, name, and IFSC code.

Furthermore, UPI transactions provide a secure layer of authentication through mobile numbers and a set UPI PIN for each user. This ensures all transactions are not just swift but secure. The versatility of UPI depends on its capability to integrate multiple bank accounts into a single mobile app, allowing you to manage all your bank accounts with ease.

How to create a UPI ID?
 

Creating a UPI ID is straightforward and convenient. Here’s a stepwise guide to help you understand how to create UPI ID.

• Download your bank or a mobile wallet app from the App Store/Play Store.
• Log in using the mobile number registered with your bank.
• Authenticate using the received OTP.
• Choose your bank from the list.
• Select your primary account if multiple accounts are linked.
• Enter debit card details and set a 4–6-digit UPI PIN. Keep it safe.
• Your UPI ID will appear in your profile after setting the PIN.
• Begin UPI payments using the app.

If you are an IDFC FIRST Bank customer, simply go to the UPI payment section, and choose your bank account. Your UPI ID and QR code will be generated instantly. Now you can pay through the beneficiary’s mobile number, UPI ID, or by scanning the QR code. 

So, the UPI framework exemplifies digital banking evolution, clubbing convenience with security. As the financial ecosystem shifts towards more digital avenues, UPI emerges as an innovative leader, reshaping how you manage and execute your transactions.

How to find my UPI ID?
 

UPI ID is a distinct identification code that could either be based on your mobile number or e-mail ID. Upon registration for UPI payment, a UPI ID number or alphabetical ID is immediately generated. This ID can be located within your UPI profile details. For those who already utilise a UPI app, you should be familiar with your UPI ID number. Also, note that you will need the UPI ID number or UPI credential of the recipients to make UPI payments. Follow the steps mentioned below to find your UPI ID:

• Open your bank app using the four-digit PIN you have set up.
• Go to your profile.
• You will find your UPI ID with other details, like your registered mobile number.

Whether you register as a merchant user or a customer, you will receive a UPI ID for your unified payment interface profile. Use this ID to send and accept payments.

How to send money through UPI ID?  
 

UPI is a convenient means of sending and receiving funds instantly. You can follow the below-mentioned steps to make your UPI-linked payment through your UPI ID.

• Open your UPI payment application using the PIN and tap on the ‘Send Money’ option.
• You will find several ways to send money, such as a mobile number, a bank account or through UPI ID.
• For sending money through UPI ID, you need to have the UPI ID of the receiver with you. Hence, make sure to ask them to share it with you beforehand so you can seamlessly make the required payment.
• Once you have the UPI ID of the receiver, simply select the ‘Pay UPI ID’ option and enter their UPI ID.
• If the UPI ID is valid, the UPI app will show the name and details of the receiver. In case you have entered the wrong UPI ID, it will not allow you to proceed. Hence, make sure to re-check the UPI ID and enter it correctly.
• Now select the bank account from which you want to make the transfer and tap on the ‘Proceed’ button.
• Enter your UPI PIN linked with the selected bank account.
• After entering the correct PIN, the amount will be instantly transferred to the recipient’s bank account.

UPI ID is particularly useful if the recipient does not use the same UPI payment app. In case, you don’t know if the beneficiary uses the same app as yours, you can ask for their UPI ID to make payments.  

Benefits of using UPI to make payments
 

The key benefits of a UPI app to make payments are as follows -

• It reduces the chance of banking information being compromised by a third party.
• With a VPA, a client can share only one ID with the other party while transacting the same way as a regular bank transfer.
• Most banking software has a built-in option for customers to use the UPI service. This has broadened the UPIs’ reach and made it more convenient for customers.
• There is no need to divulge details about the bank account or the IFSC code. It reduces the chances of fraud.
• Most merchants accept UPI payments, which is great for consumers.
• You do not need to remember your card number and CVV code for online payments. Knowing your four-digit UPI PIN is enough.

Types of UPI format available in India
 

There are several formats for UPI IDs available in India. The most common in use is the mobile number followed by the '@’Bank. which appears as 9999999999@Bank, where the numbers represent the digits of your mobile number and ‘Bank’ represents the name of the bank that offers the payment service. Similarly, you can also find the UPI ID starting with the characters of your e-mail ID, for instance, abcd12@Bank, where the characters represent your e-mail ID followed by the ‘@’ and the bank that provides the payment service.

UPI is most widely used because it offers the convenience of instant payment through a mobile number. You can simply choose the beneficiary from your contact list and proceed with the payment. The UPI service automatically picks all the details of the recipient’s account through the linked mobile number.

Features of paying with UPI
 

UPI offers numerous features which make it the most popular payment service for daily transactions. It is fast, secure, and easy to use. The following are the key features of UPI payments.

• UPI is a free-to-use service 

UPI payment service works on the Zero Fee framework as mandated by the Indian Government. Whether you are a merchant or a customer, no fees are charged on payments through UPI.

• Instant money transfers

Using UPI, you can send money instantly. The process is quick and simple and does not require detailed account information to transfer funds. Additionally, UPI is available on public holidays, 24*7, 365 days a year providing uninterrupted service. You can easily use the app to pay utility bills, and credit card payments, pay for EMIs and insurance premiums and more.

• Robust security
  

In addition to PIN security, UPI uses Virtual Payment Address (VPA), which does not expose your bank account details or debit card numbers. Hence, keeping your bank account safe from fraudulent activities.

• Platform independent 

UPI payment is a unified technology and does not depend on a single bank or app for payment. Moreover, all the bank accounts can be accessed in one place using the UPI payment apps. It makes fund transfers more convenient.

• Integration of credit cards with UPI 

It is soon expected that UPI will also be integrated with various financial organisations to link credit cards with UPI and customers can make payments using their credit cards.

• No minimum transaction limits 

UPI does not impose any minimum transaction limit on fund transfers. You can send an amount as low as ₹1 through the UPI app. It increases the usability of the fund transfer system as more individuals can use it without the constraints of minimum limit.

• Works without internet 

The UPI payment app works without the internet. Smartphones need an active internet connection to perform transactions. Payment service can be availed without internet. For sending money without using the internet, you just need to make use of the SMS service.

• Transaction history 

UPI apps also maintain a record of all your transactions. This makes tracking your payments and expenses straightforward, and you can easily monitor your spending habits.

• Link multiple bank accounts 

One UPI app can be linked to several bank accounts, eliminating the need to juggle between different apps for different accounts. This integration simplifies money management for users who have multiple bank accounts.

Together, these features make UPI not just a convenient and secure payment method but a comprehensive digital solution that caters to the diverse financial needs of individuals and businesses today.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.