UPI Payments: 10B transactions a month done, next stop 100B (opens in new tab)

> Just go to the money exchange counters and enquire about this. Airport information desk should help you as well.

> You can get a local prepaid phone number sim at the airport.

Worth noting, do all this before you leave the airport. Assuming you land in Delhi, once you leave the airport there's no way to get back in unless you have flight information to show

This turned into a pretty big problem for me on my first trip to India once I exited the airport with no way to make phone calls, no data, no sense of where anything was, and no rupees (I hadn't exchanged cash yet)

1) This is never explained to visitors in way that'd get their attention - for example, getting a paper from immigration explaining that's available. Too complicated for now. Maybe once this is available outside the airport it's more viable. Strongly recommend visitors to just take out cash, and carry the amount they need per day + 50% on them. Personally I got by living in India for several years primarily using my American Express card which was accepted at more places than I expected.

2) I wouldn't advise visiting foreigners to get a sim as it requires passing your passport scans to untrustworthy low-level staff at the cell companies. It worries me how they take the passport to a backroom to scan it. I worry they're selling/distributing copies. I realize hotel staff also scan passports but they have reputations to protect and are less likely to. Google Fi/T-mobile roaming or an e-sim via Airolo are much more appropriate and wise choices for short term travelers. If you know somebody in India however, asking for a SIM is totally fine. You can pay to add funds via an international service like Xoom or an American Express card in the Airtel app (which worked for me occasionally)

Protip about American Express cards in India, and the reason I mention it several times. I lost mine last time I was visiting and they sent a new one to my hotel in under 48 hours.

1) is somewhat impractical, because it’s easy to miss the airport desk which does this, and if you miss the opportunity it’s not easy to go back there (Indian airports don’t really allow you back in if you’ve exited)

2) opening an account isn’t practical for tourists, but of course if you’re living in India for even a short while, it’s worth it.

3) Allegedly UPI will work for NRIs / OCIs with foreign phone numbers. In reality most banks haven’t implemented it yet.

tl;dr - “onboarding” onto UPI for short-term visitors is mired in burdensome bureaucracy, and this isn’t a technical issue with UPI, it’s a result of conscious choices by Indian regulators.

The real win would be if you could load up a UPI wallet like you’d do with PayPal. Perhaps initially restricted to people with a valid visa. But regulators haven’t figured that out yet.

> This entire process of opening an NRO account can be done at a bank branch physically or online via your mobile phone.

Online method is not possible since banks and other providers insist on providing Aadhaar number and completing OTP authentication for that mode. Aadhaar is a number given for residents, i.e., anyone who has legally resides in the country for more than 182 days. So a foreigner landing in the country isn’t going to be eligible for it until six months have passed.

Thanks for this information. I am a NRI and I do have a NRO account. Can I use that account for getting a UPI wallet?

What's the Cheq UPI business model? Standard VC-backed startup one, of get bought or IPO, or stay in biz and make profits. If profits, how?

As a foreigner who's lived in India for several years, what I'd really prefer is the ability to make payment using the instruments I have and not having to do a whole "KYC" process that no other country would ask me to. Context - within my home USA, I can open bank and credit cards accounts without ever even showing an ID. Having to ask very local shops to scan your passport/visa is an extremely uncomfortable request for people from abroad who have been told to protect that document from identity thieves their whole life. Nobody wants to give their address or phone number to a shopkeeper. I wish you guys all the best, but ultimately what India needs is more of those awesome Pine terminals which reliably take foreign cards and Apple Pay support. Then they get the lost card and chargeback protection they get everywhere else. So many foreigners are willing to come and spend money at small shops, why not better enable them to with the tools they have?

A normal European debit card works everywhere. Cash-only establishments are uncommon. With that said I don't know how complicated the procedure is for a non-EU citizen to get a bank account (and with that a normal debit card) after moving to Sweden and having obtained a permit for residency. For EU citizens it's not a hassle.

I lived in Sweden for 6 months in 2018 and didn’t have any such problems.

My Dutch Maestro debit card worked in all shops and cafés I visited, and online I was usually able to use a MasterCard.

Personnummer was really only required for things like phone plans and store loyalty cards, which you don’t really need. I just used EU roaming on my Dutch SIM, but if you’re non-EU I believe you can get PAYG/prepaid SIMs without needing a personnummer.

If you move from another EU country this is the problem that EMPSA are trying (though with no visible success) to solve: https://empsa.org/

I was back there 2 months ago. That facility was not available and I was from one of the 20 countries that are allowed (you can specify a US/Can phone number). I downloaded PhonePe and PayTm. You at least needed a NRE (rupee) account. What seemed to work always was tap. But I think the tap amount was always < us 200.

If you have guidance on how to setup Google Pay/other with UPI it would be appreciated. I even tried updating my Google Pay software to get the Indian version in the hope it would work.

UPI is great and I hope it becomes worldwide. I think they started in France recently. If you are an Indian citizen/OCI holder encourage your foreign banks to get involved. I do not have much hope for Canadian oligopoly banks but if a bank in the US got it I would move some of my money there.

American here. I visited India in June of 2023. I tried using various apps to access UPI, but I was unable to figure it out. I couldn't find a way to connect a USA account (bank, credit card, PayPal, etc.) as a payment source. Hopefully it will be easier soon.

Can’t wait to hand over my passport and drivers license to some random person after security wearing a uniform and holding an iPad after I get off an 8 hour red-eye.

Surely nothing can go wrong.

Really? Which airports? I was there 2 months ago.

any source?

"the rest of the planet" doesnt accept visa/Mastercard just anywhere and certainly not amex. In e.g. The Netherlands, mostly cashless society now, creditcards are hardly ever used by locals and so many POS won't have the infra to accept CC payments.

The world is not the US and the US isn't the world.

They accept credit cards in most well to do stores. However street side shops probably do not. Most business avoid it due to the fee. UPI has them hooked with no-fee right now but fees are expected in the future. But right now, they have a no-fee option which is better than mc/visa/amex.

Amex acceptance in India is really good. Hotels, malls, Ubers, restaurants all take it without issue. I mean you can't buy food from local stalls, but as a foreigner visiting it's better to stick with branded restaurants to avoid food sickness (and if you're going someday, pack Imodium, best thing to get back on your feet after just a day)

It is accepted in most restaurants and shops, but for transactions of lower amounts UPI is preferred due to the fee involved with visa and mastercard

I couldn't pay for lunch at my friend's office. They only accepted UPI as payment. It would have been nice to be able to pay for tuk-tuks and car taxis without using cash, too. If you only have "large" bills, the drivers never seem to have enough change.

RedBus and many other Indian apps & websites don't accept foreign credit cards. It can become a real headache when traveling in India as a foreigner.

The receiver don't have to be naked. So, here is the story that got me to look into this a bit to learn what was happening. Father-in-law don't keep all the phone numbers updated, so, he picks up all calls -- mostly video calls from his kids and grandkids.

One day, he picked up a WhatsApp Video, where the woman on the other end was pretty much naked. Father-in-law was in the couch and gave the phone to my wife, asking who is on the other end. After some verbal exchanges to stop calling us; a barrage of WhatsApp message began -- screenshots of a semi naked women and father-in-law on a video chat.

I ignored the first time wife complained. By the 3rd, or so message, I called up a friend to give them a casual call and let them know who he was. Yeah! This whole scamming to get people's picture in phone screenshots getting "viral" seems to be a common scam in India.

> So the success rate of any given call is going to be 1-2% at most, given that otherwise theres nothing scandalous to post

OP didn't mention it explicitly, however, chatting with a scantily clad person on the other end can be used as blackmail material too no matter what state of dress you are in.

1-2%?! Do you sleep in your clothes?

And while many of us don’t by habit take video calls from strangers when we are disrobed, at scale in India it’s sure to happen.

if i'm clothed 98% of the day, it was a bad day. i wear as little as possible at all times. takes all kinds, however, but i'm sitting in mccarthy, alaska rn, in a robe i brought from my home in anchorage, so i'd only have to put on pants when necessary.

If you have 'custom' UPI ID (and not <phone number>@bank) then UPI payment is not an issue

The UPI protocol lets the acquirer lookup this to get additional information, and this is being used by several acquirers, notably Smartbuy@HDFC to provide phone numbers to merchants.

Nope. An alphanumeric UPI handle won’t hide your phone number [1]

UPI payments also ~~leak~~ share the person’s full legal name on transactions…and the phone number.

[1]: https://scroll.in/article/1045536/are-your-upi-payments-farm...

Yes, upi ID generated by wallet app (I use PhonePe) doesn't tell others anything about my bank. It simply says money sent from davchana@ybl (YBL is Yes Bank, but my connected accounts to PhonePe are not Yes Bank). All PhonePe accounts are ybl irrespective of your connected banks.

I think the issue is that Bank Accounts also need phone numbers linked to them and it seemed like only one phone number could be tied to an account. Having a secondary phone number used to combat spam also being the sole number tied to a Bank account could be bad. I could be wrong about the single phone number for an account, but that was what I experienced recently.

Account is tied to person's account number. Apps usually need current crop of phones, 5-7 years old phones not supported by app store are also not supported by apps.

I refuse to give phone numbers and usually the cashier will enter their own fake phone number to let the system proceed further. Some shops like decathlon tried to force us to install their app, create an account and then scan and pay through that – at the cashier counter. I just left the entire shopping cart there and walked out without purchasing. Such crazy things do happen but those companies will learn the lesson quickly as Indians are quite savvy about these things.

> PIX is similar do UPI, predates it in fact

PIX was announced in 2019, UPI was launched in 2016.

No, you can make any upi id, like emails. Apps, being lazy, start giving phonenumber@app id to its new users. I always have used custom@app upi ID.

I’ll avoid repeating my previous comment [1], which has details on this. Unlike the mistaken belief of several people on this post, UPI does share the phone number even if a person uses an alphanumeric UPI ID instead of the initial or common phonenumber@provider address.

[1]: https://news.ycombinator.com/item?id=37371646

Not the protocol itself. Your ID is an arbitrary alphanumeric string that you register with a provider. But most people just use their phone number.

Paying via QR code is irrelevant, the receiver will see the UPI id you paid via, and 99.9% UPI ids are phone@<some_alias>. The QR code just is a shortcut to typing the UPI id.

There is a similar thing in Switzerland called "Twint".

"Check wielding Americans"?

Haven't needed my checkbook in many years now, almost everywhere has tap-to-pay and the rare place which doesn't has a chip reader.

Oh swish is traceable and actively monitored. A few college friends of mine were organizing a party and they all chipped in a 100 kr to one guy (about 25 individuals) who got a call the next day from his bank for suspicious activity.

Not interested on flamewars here. Reading this thread it looks like merits of system is upon peoples arbitrary metrics based on varying perspectives. So a constructive discussion is not going to happen.

So until there is some standardised comparison probably making any statements about merits or demerits, including mine are just opinions without facts.

I would love to see similar public-private consortium systems in rest of the west like Germany, Spain, France and Australia etc. Until then I’ll consider UPI to be superior to those in the west.

Others have the system but is it as good and seamless as the Indian one?

I’m sure your nfc card/phone works great in Germany but it’s worth noting that part of the reason is that your card is likely Mastercard/visa. Here in the Netherlands tap and pay is also seamless with maestro cards… but the moment you try to use it internationally, POS machines reject it (“out of network” or something). If you have a diner’s card or an American Express card you might notice how many terminals/pos’es reject those as well.

> I want it everywhere badly in west as well as east and middle(-east).

It's already there.

With the exception of the US, almost every country I've traveled to in the Middle East, Asia, and Europe has tap-pay enabled. The Middle East has virtually everyone paying with their phones via NFC. In India Apple Pay doesn't work but when I travel there I can use my phone every time. NFC cards are also the norm.

We opted fo chip-and-sign over chip-and-pin, so it's probably safe to assume that everything we do is a touch less smooth and safe.

Then again, we don't really the regulation framework for making me feel like cell phones are a safe way to move money around. (Because I have trust issues with tech.)

UPI isn't QR based it you can also use UPI ID, which is like email. For eg: example@provider

And most UPI are linked with phone number, so you can also pay via phone number if UPI is linked with it.

The problem with apple pay is that it is inaccessible to 80% of the population.

It’s not just QR. Plenty of other modes of payment supported including Whatsapp and Google.

The government aggressively manages the system to prevent any single company from getting too much weight and forces them to address scams or other system occurs in almost real time by the threat of being thrown off the rails.

Just curious, why you hate QR code system ?

usually people initiate transfer using 10 digit phone number. i really dont like QR codes too because most of the time either the QR code is not oriented for easy scanning or worn out and no longer scannable.

Seems like it's a good example of developing countries skipping technological nodes and ending up with better solutions. For example, most of eastern Europe was already using fiber/copper Ethernet 15-20 years ago, while most western Europe and US were stuck with crappy DSL lines.

In the payment processing sphere, we are stuck with a duopoly that charges insane fees for something that was very complex and labor intensive 50 years ago. But today - if we could start from scratch - the entire payment volume of EU can be processed on a well provisioned computing rack with a software written in less than a year by a small team. It could be offered by ECB as a free service, with strong privacy guarantees written in EU law.

Entire modes of fraud, such as credit card cloning, would cease to exist. Online payments - seamless, safe, and instantaneous, just scan a QR code.

But we cannot start from scratch because the incumbent is good enough and the rent they extract from each member of society is small enough to not motivate them to initiate a switch, even if the aggregate rent is a staggering amount that would be recouped in days of the new system going online.

The interop with banking across SEA is pretty cool now, most countries have cross border payments with nothing more than a QR code. And this is down to the hawker stall level.

It's advancing a lot quicker than you'd expect given that many of the countries aren't really that good at coordinating with each other.

Spending quite some time in both Malaysia and Thailand I can say that the support for cross country payments is still not great. I’m rarely able to use my Malaysian banking app (Maybank) to pay in Thailand. Most of the times when I tried the QR code is not recognized. Which means I still need to carry cash with me all the time.

Already does between Singapore, Malaysia and Thailand with ISO 20022 compliant cross border fast payments.

I was in Lao as a tourist late last year. I was able to link the QR payment system (Loca) to my international Mastercard.

Weird as Thailand being a tourist country attaching your credit card to top up a qr code payment app should be easily available to tourists.

This is already a thing, but it works the other way around. Here in South Africa, the largest private short-term health insurer gives you up to 75% cash back for 'healthy food choices' [1] i.e. they effectively reduce your premiums if you signal that you make healthier choices than other people in the fund.

The law in South Africa says that short-term health insurers can't charge different people different premiums, so this is an 'add-on cashback scheme'.

They integrate with 2 big supermarket chains: when you pay with a credit card issued by the insurer's banking partner, your discounts are automatically processed on a line-by-line product level. They also integrate with a fast food chain in the same way, Nandos, and give you a discount for selecting the 'healthier' food choices on the menu.

[1] https://www.discovery.co.za/vitality/help-healthyfood-health...

I agree than tracking detailed purchase data can lead to serious discrimination and inequity especially in a dictatorship. The use case in your example, however, seems fair:

* The person has a choice whether to consume fast food regularly. It’s their freedom, yes, but they should also accept the costs that come with their lifestyle choices. Similarly, if someone chooses to regularly drive at a daredevil speed, they should pay a higher premium.

* This is different than discrimination based on involuntary characteristics. If someone is born with genetic predisposition to get cancer, or happens to grow up in a city with high carcinogen level, it’s arguably a lot less fair to charge them extras.

Why could this not also be done with currently used card systems?

Oh yea, privacy nightmare! Enjoy. I'm out.

How would my insurer get access to my payment history?

one conspiratorily wonders if its a government ploy to turn everyone cashless so that they can be debanked at will.

Jio's push for 4G and unlimited data packs helped a lot as well. Pre-jio, internet was too expensive, unreliable, and slow to use frequently.

I'm amazed by their recent 5G coverage in the country too. Getting unlimited 1gbps in a lot of tier 2 and 3 cities at $3.5 a month. Unbelievable

Pulling currency from circulation overnight also did.

they usually have a sound box, which will announce if a payment is made to their UPI id.

Related - https://restofworld.org/2023/india-sound-boxes-paytm-phonepe...

The banks provide 4G-enabled speakers either for free or very cheap.

These speakers automatically read out any credit into the account.

Even a vendor who can’t read can use UPI to reliably receive payments.

There are 5 parties in UPI (or any payment system really): 1. bank customers, 2. bank, 3. payment network, 4. 3rdparty apps (TPAPs) 5. merchants.

UPI is free for #1. It costs #2, #3, #4 to build and operate the systems. So, #5 pays for accepting payments in UPI. But what they pay is far less than what it costs them to accept payments via other means including cash. Also, #2 pays somewhat because it is a service their customer values. Banks also like it because the network fees are far cheaper than other networks like Mastercard and Visa.

Naively someone might think paying and accepting in cash is free. But reality is cash handling can get expensive – leakages (cashier steals), counting and tallying cash, time lost in going to bank branch to deposit cash, dealing with providing exact change etc. are all expensive once you see how convenient and highly productive digital payments is.

That's an excellent point, as scalability has been the critical handicap of public blockchains to date.

This article is nearly two years old, but provides a good overview of the latest techniques devised for achieving scalability in public blockchains:

https://polynya.medium.com/rollups-data-availability-layers-...

Since then, layer 2s (which are the principal execution layer of the modular blockchain stack the article above expounds upon) have seen exponential growth in adoption, and mounting innovations bringing them progressively closer to their theoretical potential of 100,000 transactions per second:

https://l2beat.com/scaling/activity

An institution like physical cash can be powerful/deeply-embedded enough to survive authoritarian governments, and I presume the same would would apply to a widely adopted electronic cash. The political cost to do away with an institution grows in proportion to how pervasive it is.

To me the argument has gotten dramatically stronger over the last five years as crypto's real world utility has grown and its full potential has come closer to being realized, while increasingly mainstream figures—including the most successful venture capitalists of this generation—acknowledge its inherent utility.

The anti-crypto contigent are consistently small-minded neurotic individuals who could be safely ignored if they did not back repressive government measures like futile COVID lockdowns, or a "War on Drugs" or "War on Crypto".

The UPI is an interface for the Immediate Payment Service, which is a payment network owned and operated by the National Payments Corporation of India, which in turned is owned jointly by the Indian government and an association of private Indian banks: the Indian Banks' Association.

I personally think a centrally owned service like the IPS is very useful. I just think we would be better off having a permissionless and decentralized alternative that has wide enough adoption to make useful and hard to prohibit, to both provide competition to the centrally controlled network, and to act as a failsafe in case that network is mismanaged and run in an abusive fashion, e.g. locking out those who refused to get a COVID vaccine.

Not op, prior to UPI all these transactions were done using cash, credit card penentration in India was quite low.

I'm sure there are ways for anyone interested to purchase an anonymous UPI account, just as there are ways to purchase an anonymous MasterCard now.

> Almost each and every concern is applicable to VISA/Mastercard system too.

Not really, when you make a payment using credit or debit cards, your name doesn’t go to the merchant (and doesn’t have to, since you can enter any name online when entering card details). Your phone number also doesn’t go to the merchant from the card number unless you decide to share it. In the case of UPI, the receiver gets the full name and many a times the phone number of the sender since that’s the most common UPI identifier.

there is already a standard. it's SEPA/SWIFT and works on IBANs independent of any banks.

but it's use case is tiny in most of the world. most payments aren't made to people you want to give money to. most payments actually go to sellers. as such what people use in developed countries is their credit card.

UPI payments to merchants have had MDR for a while now. And there is a government fund to compensate banks as well. Cost on its own isn't the real reason for banks to be unhappy. Banks were unhappy because they were not used to this kind of pace of feature growth and user growth. It put operational stress on their teams and their relatively old systems (much newer than western banks). They also saw it as a zero-sum game where UPI had opportunity cost w.r.t growth/profit in credit cards. But the reality is somewhat different. Affluent class still uses credit cards (for loyalty points, irony!) and cards market has grown quite well too. And as digital usage expands and banks have embraced digital, they see UPI as an engagement driver and they make money on selling other financial products including credit cards and loans. Anyone who isn't thinking this way will be killed by competition soon enough.

Banks are in general happy as any cost is offset by reduction in cash handling cot. ATMs installation and maintenance are costly, branches even more so, you can reduce that. Also, for the merchants, cash handling cost is greater than 0.

> I suspect at some future point UPI (non-wallet) transactions will be charged a small fee and wallet transactions will not.

Right now, it is other way round. Wallet transactions above ₹2000 attract some fees for merchants.

UPI is not free and people should really stop parroting that talking point. It is free, FOR NOW.

There are plans in place to charge a 1.1% fee for transactions to merchants. The indian government claims that there will be savings via banks handling less cash but it provided exactly zero in the way of calculations, estimates or data. In 2022, the indian digital payment industry expected a net loss of around 60 million USD.

> UPI requires bank account but you need UPI id to transfer the fund.

UPI requires a bank account, a mobile phone number linked to the bank account and a smartphone to transfer funds for anything other than a trivially small payment (tiny payments are now supported on feature phones).

So why is it that UPI has gained more usage in one country than crypto has worldwide in a short space of time?

Even MPesa has more usage than crypto has in more countries since it was launched around the same time that Bitcoin was released.

Even with all of this, cryptocurrencies such as Bitcoin having sluggish transactions per second causes those to just use centralised systems such as UPI.

Those in crypto circles keep heralding the phrase 'banking the unbanked' but it seems that those people in 'unbanked' countries have built a better system than crypto was intending to solve in under 10 years.

It stands to question crypto's relevance in the first place as a means for payments (not speculation which it is mostly used for)

So explain how?

Shooting several people in a bid to get them to hospital to have their corneas scanned for cataracts can also lead to lower cataract rates. That doesn't make it the best way to get people to scan for cataracts.

Why was the PM advertising for a 3rd party wallet?

The goal of demonetisation has never been clear. It was a thuglaq move and Indian right wing has retro fitted motivations to it.

"daily UPI limits of $1200"