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Interoperability in payments to be a reality with the United Payments Interface

The National Payments Corporation of India has initiated the implementation of the Unified Payments Interface (UPI) to simplify and provide interoperability with a single interface across all systems. The NPCI has published a draft document (pdf) for the payments architecture and will soon be coming out with application program interface (API) for payments systems providers to implement. Nandan Nilekani, honorary advisor for innovation at NPCI at an event in Mumbai said that a pilot programme using the UPI will be coming out within 4-5 months.

To simplify things, the UPI is an additional layer of payments architecture built upon the IMPS mobile payments system. However, the additional layer provided by the UPI will allow interoperability between different payment systems. For example, through the UPI, a Paytm customer can make a payment to an HDFC Bank’s customer directly into their account.


Some of the core features of the UPI include: 

– The ability to make payments using a mobile phone from person to person, person to entity, entity to person.

– The UPI will allow payments only by providing an address with others without having ever provide account details or credentials on third party applications or websites. This will be done through virtual payment addresses that are aliases to bank accounts. Payment service providers can make payments from any account using any number of virtual addresses using credentials such as passwords, PINs, or biometrics on mobile phone.

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-The payments architecture will also allow people to initiate pull or push payments.The UPI will allow users to pre-authorize multiple recurring payments similar to ECS (utilities, school fees, subscriptions, etc.) with a one-time secure authentication and rule based access.

Payment addresses and mapping 

Under the UPI, a payment address is a handle that can uniquely identify account details. In this architecture, all payment addresses are denoted as “account@provider” form. Address translation may happen at provider/gateway level or at NPCI level. However, note that under the architecture, payment addresses offered by the provider need not be of permanent nature. For example, a provider may offer “one time use” addresses or “amount/time limited” addresses to customers. In addition, the payments addresses can also limit to specific payees. For example it can whitelist transactions originating only from IRCTC.

Some of the examples of the virtual payments addresses include:



Provider is expected to map the payment address to actual account details at appropriate time. Providers who provide “virtual addresses” should expose the address translation API (see later sections for API details) for converting their virtual addresses to an address that can be used by NPCI.

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“Currently at NPCI we are mapping financial addresses with Aadhar. We are also looking if the mobile number can be used as a financial address. Similarly we are looking if email can act as a financial address. This will be done on a single mapper, a large mapper and we are calling it the National Financial Mapper. The Aadhar mapper is becoming a big mapper where many types of financial addresses for the same type of  person is available and depending on what information a person has given to the other party. So various types of financial addresses can be developed using the National Financial Mapper,” said A.P. Hota, managing director and CEO of NPCI.

NPCI is enhancing the central mapper to also have mobile to account mapping. This allows anyone to send/receive money from a mobile number without knowing the destination account details. Customers, via USSD, can manage multiple mobile to account mapping and conduct transactions via USSD. This feature also allows smartphone users to seamlessly interoperate with feature phone users. Unified Payment Interface allows PSPs to take full advantage of this mapping and allow their users to send/receive money just providing a destination mobile number.



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