A look at the pain points for Uber if it tries to add UPI as payment option

Online cab hailing service Uber is looking at adding new payment options for passengers and might add the UPI as well, a spokesperson for the company told MediaNama. This was first reported by Trak.in which said that the company was testing UPI integration and was in talks with the National Payments Corporation of India (NPCI). However, the spokesperson declined to comment to MediaNama whether it was testing or developing the UPI for Uber.

Currently, Uber allows passengers to pay for rides via Paytm, debit and credit cards, cash and the Jio Money wallet. Note that Uber had been looking to develop its own closed-loop wallet so that it could simplify payments. The company’s pain point with other digital payment options in India is that they take too many steps to complete a transaction and have been chasing the Holy Grail of ‘one-touch payments’.

Uber has always said that a “seamless payment experience” is crucial for the company. Readers will remember that Uber had tried to provide one-touch payments for card transactions but ran afoul of the Reserve Bank of India’s (RBI) guidelines in 2014. The RBI guidelines had mandated that card-not-present transactions will have to go through a second factor of authentication which required users to enter a password or an OTP.

At the time, the company had to suspend card payments sand tied up with Paytm for digital payments. Eventually, Uber did resume card payments and tied up with Zaakpay for the same.

Note that rival Ola already has UPI as a payment option but it takes many steps to complete a payment and seems to have no qualms about having one-touch payments.

UPI has too many steps

The UPI will not help Uber in its quest for one-touch payments in India. As Nikhil Pahwa noted when Paytm added UPI as an option to load money to their wallet, the UPI simply has too many steps for a user to jump through. The UPI option will probably take a user through 5-7 steps to complete a payment.

Here are the number of steps a user might have to go through for UPI

– First, a user will have to enter their virtual payment address.
– Second, Uber will send a text which will prompt the user to open their UPI app.
– Third, the user will be prompted to pay Uber the amount for the ride.
– Fourth, the user will have to enter their PIN.
– Fifth, it will give a confirmation.

A simpler way for Uber is to generate a QR code at the end of a ride with the payment details. A customer can scan the QR code and enter their PIN. Sure, it is not one-touch but it is still fewer steps.

3 Comments

PRK July 19, 2017

UPI is significantly faster than other online payment processes at this time.

Paytm without money in the wallet is a pain.

Comparing that with BHIM, BHIM is a breeze which takes like 5-10s to complete a transaction compared to OTP nonsense which takes more like 20s.

humanusa August 28, 2017

true prefer UPI as one just needs to approve UPI payment and its done.

sketharaman June 1, 2017

Uber doesn't do many things the way others do. When I use PayTM to pay any merchant other than Uber, I need to have network connectivity and go through a couple of taps. When I pay Uber via PayTM, I neither require network connectivity nor need to do nothing at end of the ride - Uber handles the entire payment on my behalf on the backend by using API or whatever communication protocol known only to Uber and PayTM. In other words, an Uber-PayTM payment is 0-tap. Based on my PayTM experience with Uber, I'd expect Uber to do something differently with UPI that requires 0 or max 1 tap. In fact, I'd go so far as to wager that, if Uber hasn't already devised such an alternative method, it wouldn't have announced support for UPI, even via whispers in the grapevine.

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