UPI is expected to bring about a significant shift in the way mobile banking transactions are conducted in India by allowing users to make payments using mobile phones as the primary device without the need to download an app to send or receive money.
Hence, users may no longer need an e-wallet. Also, people will be able to use multiple e-wallets seamlessly as they will become interoperable with UPI.
What’s more, there will be no need to disclose identity while making payments. The way it works is that one has to simply give a virtual address to the merchant, which will then request money from it. The user will get a message on the mobile phone asking for authentication. Once the password is entered, it will be complete. Importantly, this process doesn’t require the share of bank details. Also, since UPI runs on Immediate Payment Service (IMPS) platform, the service will be available in real-time.
Finally, UPI enables a two-factor authentication in one click. So far, for a two-factor authentication, clicking multiple times is required. The new system will allow for a one-click, two-factor authentication on mobile phones across bank accounts.
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