How to Use UPI: Requirement, Account Set-up Process

UPI, or Unified Payment Interface, has made financial transactions easier. This is because it has eliminated the hassle of remembering IFS codes, account numbers, bank branches and contact numbers. Now, all you need is to download the UPI payment application and have the recipient's number on your mobile phone to transfer money in a few minutes.

If you are new to this system and want to know how to use UPI, keep reading this article.

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What Do You Require to Use UPI?

Before proceeding with how to use UPI, let's obtain the basic knowledge of what you need to use UPI.

So, to use UPI, you should have a bank account in a member bank. The bank must allow you to make financial transactions via UPI. Some banks that allow financial transactions via UPI are – HDFC Bank, State of Bank of India and ICICI Bank.

After checking whether your bank supports payments via UPI, you can download any UPI-supported application on your mobile phone. In this regard, some of the most commonly used UPI applications are BHIM, PhonePe, Amazon Pay, Paytm, etc.

Note that you must register your mobile number with your bank account to verify your identity.

How to Create a UPI Account?

Here are the following steps to set up a UPI account:

Step 1: Download the UPI application, such as BHIM, from the App Store or Google Play Store.

Step 2: Select the language you are comfortable understanding. Verify your contact number.

Step 3: Select the bank account. The selected bank will send you an OTP or one-time password to your registered mobile number to check if it is your bank account. Once you verify the same by entering the OTP, it will develop a virtual payment address for you.

Step 4: Create your profile by submitting your name, virtual ID, etc.

Step 5: Select 'Link', 'Add' or 'Manage Bank Account' to link your account number and bank with a virtual ID.

Step 6: Create MPIN by submitting your debit card's details. You need to enter this MPIN before you make any transactions.

By completing this process, you are now a registered UPI user and can send money or request someone else to transfer money to your account. You can connect more than one bank account to any UPI application. However, note that a mobile wallet cannot be linked to the UPI application.

How to Use UPI for Making Payments?

You can use UPI to send money in the following ways, which are mentioned below:

Choose or Provide the Mobile Number: You can either open your phonebook and select the recipient's mobile number or enter the mobile number manually, type in the amount you want to transfer and PIN. With that, you can transfer the money in a few minutes.
Scan QR Code: You can scan the QR code of the receiver. For that, you need to open the UPI-supported mobile application and select the option to scan the QR code. Now, scan the recipient's QR code and provide the amount you want to pay. Enter your UPI PIN to finally complete transferring the money.
Provide IFSC or Account Number: This is the conventional payment mode, and UPI supports this payment method. You can provide the recipient's account number, IFSC, amount to be transferred, and PIN to transfer funds from your bank account to another.
Provide UPI ID: Open the UPI-supported application on your mobile phone. Enter the recipient's UPI ID and the amount to be paid. Verify the payment by providing MPIN to complete the payment process.

How to Send Money via UPI?

Go through the simple steps stated below to send money via UPI without any hassle:

Step 1: Sign in to your UPI-enabled mobile application such as BHIM, Paytm, etc.

Step 2: Navigate to the UPI section, for instance, Send Money, Money Transfers, etc.

Step 3: Select 'Send', 'Pay' or 'Make Payments'.

Step 4: Scan the QR code or enter your virtual payment address

Step 5: Type in the amount to be paid and MPIN to authenticate your transaction.

Step 6: Select 'Send' to complete this process.

How to Receive Money via UPI?

Take a look at this step-wise guide that mentions the process of receiving money via UPI:

Step 1: Sign in to your UPI-enabled mobile application.

Step 2: Choose the payment receiving option – 'Request Money' or 'Collect'.

Step 3: Type in the remitter's or payer's VPA and specify the amount to be transferred.

Step 4: The payer will receive a notification after submitting a request.

Step 5: Once the payer accepts the request, he or she will provide the MPIN to verify the transaction.

Step 6: After a successful transaction, both payee and payer will receive notification of credit and debit.

How to Use UPI 123PAY?

The National Payments Corporation of India introduced UPI 123PAY services for people with feature phones. This service will allow them to make financial transactions by utilising any four options available, such as IVR and missed call-based method.

So, to use the UPI 123PAY service on your feature phone, follow the step-wise guide mentioned below:

Step 1: Call on the IVR number 08045163666 from your phone.

Step 2: Choose your preferred language available on the IVR menu.

Step 3: Select the bank that is linked with UPI. Press 1 to confirm the information and send the money by entering your mobile number.

Step 4: Type in the recipient's mobile number and confirm the information submitted.

Step 5: Specify the amount you wish to send to the recipient.

Step 6: Finally, enter your UPI PIN to verify the payment.

So, if you have a feature phone, you can use UPI 123PAY to transfer money to your family members and friends. Besides, you can also pay utility bills, mobile bills and recharge FAST Tags. Moreover, you can also check your account's balances, change or create a UPI PIN and link bank accounts.

What Is the Maximum Limit of Transferring Money Using UPI?

Currently, the maximum limit of UPI transactions is ₹ 1 lakh for each account per day. Within this maximum limit, different banks may impose their sub-limits. Therefore, you must check the same with your bank.

Once you know how to use UPI, you can transfer money from your bank account to another within a few minutes whenever you need it. So, keep all these step-wise guides in mind so that you can make or receive payments without facing any inconvenience.

Frequently Asked Questions

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Are financial transactions via UPI safe?

Yes. The Reserve Bank of India regulates UPI payments. You can only make payment from your mobile phone in which the SIM card installed has the mobile number registered with your bank account. Moreover, you need to verify your payment by entering the UPI PIN to maintain security.

What happens if you enter an incorrect UPI PIN before making payments?

If you enter an incorrect UPI PIN, you will fail to make the payment. Moreover, if you provide an incorrect UPI PIN several times, your bank will temporarily block the facility of making payments via UPI from your account. However, this action may differ from one bank to another.