UPI continues to evolve as India’s most preferred digital payment method, offering fast, secure, and convenient transactions. With the latest updates, ranging from enhanced security features to app usage limits, users can expect a more streamlined and safer payment experience. Staying informed about these changes ensures you can use UPI efficiently and securely for all your daily financial needs.
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UPI: Unified Payments Interface – Instant Mobile Payments
The Unified Payments Interface (UPI) is an instant, real-time payment system developed by the National Payments Corporation of India (NPCI) that enables seamless fund transfers between bank accounts through a single mobile application.
In this article, we will explore what UPI is, UPI full form, what a UPI ID and PIN are, how they work, and how to set them up, and many more.
Latest Update: UPI Collect Request Ban from 1 October 2025
From 1 October 2025, the NPCI has banned peer-to-peer (P2P) UPI collect transactions. The feature, which allowed users to request money from friends or contacts, is being discontinued due to rising fraud cases. Verified merchants can continue to use collect requests, but individuals will no longer be able to generate P2P requests.
What is UPI?
UPI is a single platform that merges various banking services and features under one umbrella. A UPI ID and PIN are sufficient to send and receive money. Real-time bank-to-bank payments can be made using a mobile number or virtual payment address (UPI ID).
It facilitates peer-to-peer and merchant payments using a virtual address as a payment identifier, supports two-factor authentication, and works 24/7 with instant settlement. UPI also enables collection requests and QR code scanning, and has played a crucial role in promoting financial inclusion in India.
Who Initiated UPI?
UPI full form is Unified Payments Interface. It is an initiative taken by the National Payments Corporation of India (NPCI) together with the Reserve Bank of India (RBI) and Indian Banks Association (IBA). NPCI is the firm that handles RuPay payments infrastructure, i.e. similar to Visa and MasterCard. It allows different banks to interconnect and transfer funds. Immediate Payments Service (IMPS) is also an initiative of NPCI. UPI is considered as the advanced version of IMPS.
New UPI Features in 2025
The National Payments Corporation of India (NPCI) and RBI have introduced new UPI rules effective from 1 August 2025 to improve security, reduce server load, and make digital payments more seamless.
- Payee’s registered name must be displayed before confirming transfers.
- Users can now link up to 25 bank accounts per day on a single UPI app.
- Pending status checks limited to 3 attempts with a 90-second gap.
- Auto-debits (EMIs, SIPs, subscriptions) processed only in non-peak hours.
- Balance check requests capped at 50 times per day per app.
What is UPI ID and PIN?
A UPI ID is a unique identification (number or letters) for a bank account that can be used to send and receive funds. UPI PIN is a 4-digit or 6-digit personal identification number that must be entered to authorise the transfer of money via UPI. The PIN can be chosen by the account holder.
How Does UPI Work?
UPI has made the money transfer process a lot easier. You do not need to remember the receiver’s account number, account type, IFSC code, and bank name. Instead, you can only make the money transfer by knowing their Aadhaar number, mobile phone number registered with the bank account, or UPI ID.
You can set up a UPI ID on one of the apps that support the UPI service. Mostly, a UPI ID begins with your mobile number, followed by the “@” symbol and ends with the app you are using. For example, if your mobile number is 9xxxxxxxx9 and if you are using the Paytm app, the UPI ID can be ‘9xxxxxxxx9@paytm’.
How to Set Up a UPI ID?
- The UPI ID can be set up by providing the details of your bank account on the app.
- The app will send an OTP to your registered mobile number to make sure that you are an authorised person. Once you enter the OTP, you will be prompted to create a PIN for the UPI ID.
- Upon completing the registration, you can choose any mobile number from your contacts and send money. You can also request money from anyone on your contacts list.
What are the Features and Benefits of Using UPI?
- Online payments are simplified.
- Pay for your transportation services, food delivery services, and shopping with UPI payments for instant fund transfer.
- Pay at the nearest restaurants, grocery stores, and departmental stores online.
- Rent, mobile recharge, and utility bill payments can be done online instantly.
Is UPI Secure?
UPI transactions use highly secure encryption format that is not easy to tamper. NPCI’s IMPS network handles about Rs.8,000 crore worth transactions every day. This is expected to exponentially increase with UPI technology. It uses a two-factor authentication method, similar to OTP, for verifying every transaction. However, UPI PIN will be used in the place of OTP for validation.
In July 2025, NPCI proposed allowing biometric UPI authentication (via Face ID or fingerprint), which would remove the need to manually enter the UPI PIN. If implemented, this would enhance convenience and significantly reduce UPI-related fraud. Each transaction would be tied directly to the user’s physical identity. The rollout is still pending as it requires robust data privacy safeguards and device-level compatibility.
Banks Supporting UPI
The major banks that support UPI services are:
- State Bank of India (SBI Pay)
- ICICI Bank (iMobile)
- HDFC Bank (HDFC Bank MobileBanking)
- Axis Bank (Axis Pay)
- Bank of Maharashtra (MahaUPI)
- United Bank of India (United UPI)
- Vijaya Bank (Vijaya UPI)
- Union Bank of India (Union Bank UPI)
- Federal Bank (Lotza)
- UCO Bank (UCO-UPI)
- Yes Bank (Yes Pay)
- Karnataka Bank (KBL Smartz)
- Punjab National Bank (PNB UPI)
- Bank of Baroda (Baroda MPay)
- South Indian Bank (SIB M-Pay)
What Apps Allow UPI usage?
Popular apps supporting UPI include Google Pay, PhonePe, Paytm, BHIM, FreeCharge, Amazon Pay, and Mobikwik. These apps comply with NPCI’s UPI guidelines and allow users to verify their bank details, create a UPI ID, and begin transacting instantly. Starting 1 August 2025, these apps are also required to:
- Display the payee's bank-registered name before a transfer.
- Limit balance checks to 50 per day.
- Allow linking up to 25 bank accounts per user per day.
About the Author
Mayashree Acharya
Senior Content Writer
I am an advocate by profession and have a keen interest in writing. I write articles in various categories, from legal, business, personal finance, and investments to government schemes. I put words in a simplified manner and write easy-to-understand articles. Read more
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