Unified Payments Interface or UPI has transformed the way Indians are making digital payments. In the year 2023, close to 12 billion UPI transactions were recorded, totaling โน18.23 lakh crores, which in a way makes UPI one of the most popular modes of payment in India. The reasons are apparently attributed to Virtual Payment Addresses that make ‘Going Digital’ fast, convenient, and absolutely secure.
In this blog, we’ll explain what VPA in UPI is, how it works, its features and benefits, and how you can use it for your everyday payments.
What is VPA in UPI?
VPA stands for Virtual Payment Address. It is a unique ID used in the UPI system that allows you to send and receive money instantly using your mobile phone. Instead of sharing your bank account number and IFSC code, you can use your VPA to make payments.
A VPA is a mix of letters, numbers, and special characters, usually in the format xyz@bankname. For example:
- yourname@idfcbank
- yourname25@upi
- 6290209786@yesg
The โxyzโ part can be your name, phone number, or any unique identifier, while the โbanknameโ can be your bankโs name, the payment providerโs name, or simply โupiโ. You can create a VPA that suits you and check its availability on your UPI app.
How Does VPA Work?
Understanding how VPA works is simple. Hereโs a step-by-step guide:
Step 1: Create a VPA
- Register with a bank or payment service provider that supports UPI.
- Choose a unique VPA, usually in the format username@paymentprovider or username@bank.
Step 2: Link Your Bank Account
- Link your VPA to your bank account. This associates your VPA with your bank account, so funds can be sent or received through it.
Step 3: Make Transactions
- When making a payment, provide your VPA instead of your bank account details. The person sending you money just needs your VPA, the amount, and authorization through a UPI-enabled app.
Step 4: Transfer Funds
- The UPI system verifies the transaction and instantly transfers funds between the senderโs and recipientโs bank accounts.
How to Create a VPA
Creating a VPA is quick and easy. Follow these steps:
- Install a UPI app on your mobile phone (like Google Pay, PhonePe, or your bankโs app).
- Link your bank account by providing your registered phone number.
- Provide the required details and select the option to create a VPA.
- Choose your preferred VPA ID and check its availability.
- Set up a four or six-digit UPI PIN.
- Once your VPA is created, you can start UPI transactions with just a few clicks.
How to Send Money Using VPA
Sending money via VPA is simple:
- Log in to your UPI app.
- Select the โFund Transfer via UPIโ option.
- Enter the beneficiaryโs VPA, the amount, and any remarks.
- Select your VPA linked to your bank account and verify the details.
- Complete the transaction by entering your UPI PIN.
The transaction is completed instantly, and the recipient receives the money right away.
How to Receive Money Through VPA
Receiving money via VPA is just as easy:
- Log in to your UPI app.
- Go to the โCollect via UPIโ option.
- Enter the VPA of the person you want to request money from.
- Specify the amount and add any remarks.
- Select your VPA where you want the money to be credited.
- Submit the details and wait for the other personโs approval.
Once approved, the amount is credited to your account instantly.
Benefits of VPA
Here are some of the key features and benefits of using a VPA:
#1. Enhanced Security
- VPA transactions are faster, safer, and more convenient than traditional methods like RTGS or NEFT.
- You donโt need to share your bank account details, reducing the risk of fraud.
#2. Changeable VPA
- You can change your VPA and use a new one. However, once a bank account is linked to a VPA, it cannot be changed or removed, and a bank account cannot be linked to multiple VPAs.
#3. 24/7 Access
- You can access your account details, check your balance, and review transaction history anytime using your VPA.
#4. Transaction Tracking
- VPA allows easy tracking of fund transfer transactions within the UPI app, providing details like the amount sent, transaction date and time, recipient information, and more.
#5. Simple to Recall
- VPAs are easier to remember than long bank account numbers, making them more user-friendly.
#6. User-Friendly
- VPAs enable hassle-free cashless payments, eliminating the need to wait for several days for online transactions. Payments can be made via the UPI app without disclosing bank account details.
The Bottom Line
Understanding what VPA in UPI is can relieve you significantly in digital payment. Setting up VPAs is easy, their usage is simple, and they are highly secure, enabling faster and more convenient transactions. Whether it is sending money or receiving money, the process is swift, secure, and hassle-free with the use of a VPA.
Start leveraging VPA in UPI today for smoother, safer financial transactions!
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Disclaimer: This blog is solely for educational purposes. The information provided is based on general guidelines and may vary across different insurance providers and lenders. Please verify all details with your insurance company or lender before applying for a loan. The securities/investments quoted here are not recommendatory. Always read the terms and conditions carefully and consult with a financial advisor if needed.
