Virtual Payment Address (VPA) is at the core of the UPI Payments. This blog shall discuss everything about VPA and important related topics.
UPI is an amazing innovation launched by NPCI (National Payments Corporation of India) and regulated by the Reserve bank of India. Because of UPI, India is leading in instant and real-time inter-bank payments.
On UPI, the number of live banks as of May 2021 is 224. The UPI transaction volume is 2,539.57 million and the value is 4,90,638.65 Crore in the same period of time. It has not been the highest but overall it has been showing upward growth.
Because of the convenience and ease that UPI has been providing in comparison to the other payment modes, it is the most preferred payment mode among people, customers as well businesses. It only needs a VPA and a UPI PIN to make the transaction.
What is VPA in UPI payments?
Virtual Payment Address is a unique identification of a person or a business in UPI payments. It is used by the banks to enable payment transfer. It is also known as the UPI ID.
How to create and use a VPA?
The types of UPI application include the following:
- Bank apps such as ICICI, SBI Pay, etc
- Third-party apps such as Google Pay, PhonePe, etc.
The bank-linked mobile number plays a central role in the registration with the apps and linking of the bank account.
It is possible to link multiple bank accounts to a single application having the same mobile number as the registered app account.
Download, Registration, and login of the UPI app
Thus, the initial steps would include, downloading the UPI application and registration with the mobile number and OTP, setting the desired login PIN (lock screen or customized).
Linking the Bank Account and Create UPI PIN
After that, the bank account linked with the registered mobile number can be fetched from the option of Adding the bank account.
Also, a UPI PIN needs to be set. It is used to authenticate the transaction every time UPI payment is initiated.
Create VPA
A VPA may include numbers and alphabets. For example, it can be yourmobilenumber@upi or abcd28@okicici. You can set a customized VPA as per the availability.
Must Read: How to transfer or receive funds using UPI?
Advantages of VPA
Let us know the benefits of the Virtual Payment Address (VPA) in the UPI payments:
- When making a UPI payment, the payer needs only the VPA of the payee. No bank details are required while making the bank-to-bank transfer with UPI. The alternative of the VPA could be the mobile number of the payee.
- It is very easy and instant to create your VPA using the UPI mobile application. Also, it is user-friendly and easy to remember. Depending on the app the suffixes are fixed. For instance: BHIM has @upi, SBI Pay has @SBI, etc. You need not wait for a VPA to be created. It is instant unlike adding the beneficiary.
- VPA makes it possible to not disclose the bank details. This enables the security of the bank account.
- Multiple bank accounts can be linked with one VPA. It could have one primary bank account and various secondary accounts.
To know more about the UPI Payments: Must Read these 7 Points on UPI
Types of VPA
The types of VPA are based upon the parties involved in a transaction and also the mode of the transaction.
- Transaction between individuals (Peer to Peer): These type of UPI payments is done through the UPI apps with the help of the VPA of the payee or mobile number (if in the contacts).
- Transaction between an individual and the merchant (Peer to Merchant): The transaction process could be similar to the peer-to-peer through VPA and the mobile application. The merchant may have a VPA through UPI for business in the apps or a QR code or the payment gateway merchant account.
PayKun and UPI VPA
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