The National Payments Corporation of India (NPCI) has added an auto pay feature in its flagship payment service platform Unified Payments Interface (UPI) that will enable recurring payment on UPI platforms. It is expected to give a seamless convenient usage for people to set up repeat payments across a variety of applications.
The new feature needs customers to give mandates for these recurring payments to be made. The mandates can be set up with a frequency of their choice such as daily weekly, monthly or annually.
“This opens up an entire array of applications for which repeated payments can be set up such as payments for streaming services with a repeat mandate, taking bus passes, train tickets, DTH subscription, insurance premium payments, SIP payments, and daily EMI payments”, said Praveena Rai, COO, NPCI.
The Reserve Bank of India (RBI) this year had allowed NPCI to develop recurring payments feature on UPI which would require consumers to give e-mandates for recurring payments made through UPI, a feature that was only available for card and wallet based payments. The RBI committee on deepening of digital payments chaired by Nandan Nilekani, which submitted its report this May, had recommended introducing recurring payments in UPI. The limit on such recurring transactions has been set at Rs 2,000 by the RBI.
It offers customers the significant benefit of being able to register their recurring payments one time without forgetting their monthly payments. It also offers services such as pre and post transaction alerts and the ability to opt-in or opt-out as per the customers’ convenience as well as modify the payment as per their requirement, said Parag Rao – Country Head – Payments Business, Consumer Finance, Digital Banking & Marketing, HDFC Bank.
“We are bringing and launching this feature with our first partner, Policybazaar, which will allow customers to safely make their payments. We have lined up many other partners from utilities, telecom, direct-to-home, subscriptions and others”, he further added.
“The launch of UPI AutoPay will benefit the process of collecting merchant payments. The use-case we have is in the entertainment segment, this solution will make it very easy for customers to set up auto payments for their OTT subscriptions”, said Bijith Bhaskar, Nationl Head, ICICI Bank.
Transactions made through UPI in June 2020 reached an all-time high, both in terms of volume and value since its inception in 2016. In June, the transaction volume of UPI increased 8.9 per cent to 1.34 billion, from 1.23 billion in May, and the transaction value increased almost 20 per cent to Rs 2.61 trillion, from Rs 2.18 trillion.
In April, the transaction volume of UPI plummeted to 990 million, from 1.2 billion in March, a drop of more than 20 per cent, and the transaction value dipped 27 per cent to Rs 1.51 trillion, from Rs 2.06 trillion in March. The transactions reported in June through UPI surpass that of February’s (pre-Covid), both in terms of volume and value.