Payments platform Paytm will be introducing UPI transactions on its platform where users can create their virtual payment address (VPA) on the app. The VPA will be issued by Paytm Payments Bank and users can link any savings bank accounts which are on the UPI architecture.
The UPI feature will be available to Android users first and iOS users later. Paytm says that the VPA created will have their registered mobile number, for example, 1234567890@paytm. Note it looks like the feature will be rolling out to users gradually and MediaNama was unable to generate a VPA on the app. However, it remains to be seen if users can edit the VPA created or create an id without their phone numbers. But it looks like users can now scan UPI QR codes on the Paytm app to make a payment.
Update: Paytm’s senior vice president Deepak Abbot said that the UPI feature is in beta testing and users will have to go to the Google Play Store and scroll down on the Paytm page to enroll for beta. He added that Paytm will also allow users to create their own VPAs as well.
Paytm being on the UPI will also allow the company to open up its merchant QR code network to other UPI apps as well. So far, it looks like Paytm CEO Vijay Shekhar Sharma seems to have shown willingness to open up their closed merchant network.
ICYMI — we have allowed banks to scan Paytm QR. Open latest Citi bank app and do it …. it is not us who have blocked anyone !!
— Vijay Shekhar (@vijayshekhar) August 11, 2017
The company has 280 million registered users, 120 million app installs, and over 5 million offline merchants.
Loading money via UPI
Note that Paytm had begun its experiments with UPI in January where it allowed users to load money into the wallet. But the process was cumbersome and required atleast 10-11 steps and juggling with multiple apps. Paytm had tied up with ICICI Bank and money would be loaded into the wallet through the VPA paytm@icici. It needs to be seen how loading the wallet via the UPI will be now that they have their own UPI handle.
Withdrawing money from wallet
During the demonetization of Rs 500 and Rs 1000 notes last year, there was a considerable usage of wallets as the cash crunch in the economy hit. At the time, many users faced issues while moving money from a wallet to a bank account. Though wallet players cut their fee during the demonetization period, wallet players started charging users for moving money to their bank accounts. Paytm used to charge 4% for users who had not completed their KYC and 1% for users who had completed their KYC. With the UPI integration, it should be relatively easy for users to send money back into a bank account and with no charge.