Unified Payment Interface (UPI)

Categories: Tech

You're in Mumbai and just had a delicious meal of potato masala. You want to pay the restaurant owner using your smartphone, so you break out the unified payment interface.

The UPI is a smartphone app developed by National Payments Corporation of India that allows real-time, peer-to-peer payment. The money comes directly out of your account and goes into the account of the restaurant owner.

The process is under the regulatory umbrella of the Reserve Bank of India, the country's central bank.

Related or Semi-related Video

Finance: What is PayPal?4 Views

00:00

Finance allah shmoop What is pai pao All right Well

00:06

in the beginning there were rocks And then there were

00:09

animal helps Then beads and jewelry then cash then credit

00:14

cards on dh Finally today papal Yeah So the history

00:18

of payment technology has seen some changes paying for stuff

00:22

quickly and easily using a few folded bills in your

00:25

wallet Is gray paying for that stuff while in your

00:28

ninja turtle One z pajamas from the comfort of your

00:32

lazy boy violence Even better So yeah paypal is an

00:35

electronic payment system that takes paying for things online with

00:40

a credit card One step further It's still routes payments

00:44

through the user's bank But everything can be done with

00:47

the well it's Just the click of a button once

00:49

you've linked paypal to your bank account Well there's no

00:52

more typing in long strings of numbers digging a credit

00:55

card out of your back pocket to check the security

00:58

code and dates and all that on that business you

01:01

just say yes Thank you kindly I would liketo buy

01:05

these anti gravity boots via paypal And just like that

01:08

those boots are well on the way to your front

01:11

Door for better or worse you know provided they've been

01:14

weighted down enough space Well paypal was originally created to

01:18

help people pay for mostly ebay purchases specifically as well

01:23

as you know a few adult art films but as

01:26

of two thousand fifteen well ebay and hey pal have

01:29

been separate companies You know breakups are hard So these

01:33

days paypal is just well doing its own thing helping

01:36

people everywhere process their monetary transactions How sweet and philanthropic

01:41

of papal to do that right They do it all

01:43

for free Yeah No not at all They don't do

01:45

it all for free In fact they're pretty expensive Paypal

01:48

is in the business of making money there A publicly

01:50

traded company Well how did they do that Well two

01:53

ways Mainly First they collect a service feet on transaction

01:57

Almost the time As long as you're just a sending

02:00

twenty bucks it's a mom for her birthday or to

02:02

your buddy kin for your entry into the football pool

02:06

Well the transaction is free to you but a merchant

02:09

i eat Anyone selling a product pays a fee on

02:13

every transaction Generally that fee is anything ever take about

02:16

Thirty cents per transaction And then there's a small surcharge

02:20

In addition based on the percentage in the size of

02:23

the transaction right Well the other way papal makes money

02:27

is by earning interest on all that money sitting in

02:30

your account like it's just sitting there And then they

02:32

invest it and they make more in interest than you

02:35

do Just sitting with cash Right Five hundred fifty dollars

02:38

You've been socking away online for a rainy day Well

02:41

paypal has been making it rain because they invested in

02:44

Yes Maybe they only make two per cent of that

02:46

money and interest But there are a lot of people

02:49

let money sitting there Paypal account So with billions or

02:53

tens of billions or hundreds of billions of dollars making

02:56

two percent two papal with almost no costs associated with

03:00

that that's Pretty margin friendly kind of business right Add

03:04

it all up and pay pallor doing just all right

03:07

for themselves So yeah until the next great revolution in

03:10

quick and easy payment processing happens Paypal and other similar

03:14

sites like venmo and apple pay and maybe stripe Well

03:18

there are where it's at Still a little tricky to 00:03:21.005 --> [endTime] trade your animal pelts though for all that dollars

Find other enlightening terms in Shmoop Finance Genius Bar(f)