Keeping track of various recurring payments such as bills, EMIs, and policy premiums can be confusing and pressurizing for customers. On July 22nd, 2020, the National Payment Corporation of India (NPCI) rolled out the UPI Autopay service to make it easier for customers to make recurring payments. NPCI released this service as part of the UPI 2.0 update.
Here is everything you need to know about the UPI Autopay service.
What Is the UPI Autopay Service?
UPI Autopay is a payment service that helps people pay their recurring bills automatically on a predetermined date. The service allows users to enable e-mandate for making payments such as their utility bills, EMIs, OTT subscriptions, mutual fund SIP payments, and insurance premiums.
Here is an example of how users can use the UPI Autopay service. Suppose a person needs to pay his electricity bill of Rs. 950 before the 20th of every month. The person may be unable to make the physical payment due to several reasons. Remembering and ensuring the payment is done before the deadline every month, along with other payments can also be a headache. Hence, he can enable the UPI Autopay service, which will automatically deduct Rs. 950 from his account every month for the bill payment.
The current upper limit for UPI Autopay is Rs. 2,000 per transaction. For a payment beyond that, users will have to use their UPI PIN.
Every UPI-enabled application offers the ‘Mandate’ option where users can create, modify, pause, and revoke mandates. To use the service, a user should authenticate his/her account the first time using their UPI PIN. Users should then create an e-mandate by scanning a QR code, UPI ID, or Intent. They can set the auto-debit amount, merchant, and frequency as per their needs.
Several banks, aggregators, and merchants have already gone live with the payment service. Some of them include HDFC Bank, Axis Bank, Bank of Baroda, HSBC Bank, ICICI Bank, Policy Bazaar, RazorPay, PayU, Paytm, and AutoPe-Dish TV.
Why Did NPCI Launch the Payment Service?
Some of the goals of launching this service include:
- Making it easier and more convenient for people to make their payments
- The government has ambitious plans for popularizing digital payments instead of cash; this payment service augments that plan
- To offer existing UPI users a safer and more secure way to make their recurring payments
- Newer and better features can be appended to the service from time-to-time
What Are the Important Features of UPI Autopay?
The payment service offers several features to UPI users. Some of them are as follows:
- Once users register for the service, they can make payments such as loans, mutual funds, recurring bills, insurance, tuition fees, and OTT subscription fees among others
- The service offers customized payment options such as daily, monthly and quarterly payments based on people’s payment patterns
- Users can view past mandates for their reference and records
- People can set the amount from Rs. 1 to Rs. 2,000 per transaction
- The service offers a secure way of making payments
- For online shopping and e-commerce, people can select the ‘buy now pay later’ option
- The service also offers features such as modifying, pausing and stopping to change the order placed for online purchases
How Does the Service Benefit People?
As mentioned above, the service makes it easier, safer and more convenient for UPI users to make recurring payments. Here are a few more benefits of the service:
- Users can avoid late and missed payments by automating them
- People can easily automate payments on any UPI-enabled apps for their existing UPI accounts
- Timely payment helps people improve their credit scores. It can also help them avoid penalties and late fees from service providers
- By automating the payments, people can avoid the headache of tracking multiple bill payments on different dates every month
- The service offers a customizable and convenient platform as per user requirement
What Are the Limitations of the Service?
With all the various features and benefits of the service, it also has a few limitations, such as:
- Users need to maintain a minimum balance in their bank accounts associated with their UPI account to make sure that payments do not bounce
- While the service does provide a secure payment feature, as always, people should be aware and be mindful of frauds that happen with online transactions
In this era of digital technology, the UPI Autopay service will make it both easy and much safer for millions of merchants and end-customers as they make recurring payments.