UPI 2.0 to launch in two weeks, minus recurring payments service

The second phase of NPCI-backed Unified Payments Interface (2.0), which is set to be launched by mid-August, will not have recurring payments service.

The service has not been included due to security concerns, said Bloomberg report quoting people aware of the development.

UPI 2.0 will offer the option of a one-time mandate. With this, customers would be able to block a certain amount of funds from their bank account to pay for a service. Besides, it will introduce five new services.

Inward remittance will be introduced for NRIs, who would want to send funds to family and relatives in India. In addition, banks will provide overdraft facilities to customers against funds they hold in their saving accounts. Invoices can be viewed by customers before they approve the transaction.

At present, customers can set up recurring payments to a merchant after giving an electronic clearing service (ECS) mandate to their bank. This was expected to be introduced in UPI application, added sources.

Entrackr queries to NPCI in this regard is yet to get a response.

Ever since its launch, UPI has witnessed rapid growth and the latest updates are expected to attract fresh users, expand use cases and drive repeat transactions on the platform.

As per the latest data released by NPCI, the transaction volume for June stood at 246.37 million, while transaction value was recorded at about Rs 40,834.03 crore with 22 per cent growth as compared to May 2018.

In its second phase, NPCI plans to leverage VPA that essentially allows users to transfer money without entering the account number and IFSC code, amongst others.

For merchants, setting up a UPI-based payment is economical and faster than the point of sales (PoS) terminal. The entry of Google Tez and Paytm, UPI ecosystem has recorded phenomenal growth in last year.

WhatsApp UPI is also about to public similar feature for its users. Till date, the UPI has been primarily used for peer to peer fund transfer.

Now the government is pushing it through a series of initiatives. Recently, it asked UPI-based apps to integrate Bharat QR code on their platforms.