{"id":7534,"date":"2021-08-12T09:02:27","date_gmt":"2021-08-12T09:02:27","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=7534"},"modified":"2021-08-12T09:22:13","modified_gmt":"2021-08-12T09:22:13","slug":"npci-guidelines-for-upi-apps","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/npci-guidelines-for-upi-apps\/","title":{"rendered":"An Overview of NPCI Guidelines for UPI Apps"},"content":{"rendered":"\n<p class=\"has-drop-cap\">In\nrecent years the digital payments have experienced rapid growth in India.\nRegardless of the Covid-19 pandemic and its economic impact, around 48 billion\ndigital transactions were reported in the Calendar Year. Overall the total\nonline transaction volume in 2020-21 was 4,371 crore, up from 3,412 crores in\n2019-20, as per the annual report 2020-21 of the RBI, demonstrating the online\npayment system\u2019s resilience in the face of the pandemic. In this blog, we are\ngoing to discuss the NPCI guidelines for UPI apps.<\/p>\n\n\n\n<p>The\nRBI is in charge of payment system supervision and <strong><em>the BPSS (Board for Regulation\n&amp; Supervision of Payment and Settlement Systems). <\/em><\/strong>The establishment\nof a new department <strong><em>DPSS (Department of Payment &amp; Settlement Systems) <\/em><\/strong>by the\nRBI in the year 2005 to focus exclusively on <strong><em>PSS (Payment &amp; Settlement\nSystems)<\/em><\/strong>, and the succeeding legislative of the PSS Act, 2007 guided in\na new era in the payment system history of the country.<\/p>\n\n\n\n<p>In\nan outlook of Payment Systems, the Reserve Bank of India viewed the requirement\nfor an organisation to supervise all the retail payment systems of the country.\nAs an outcome, <strong><em>NPCI (National Payments Corporation of India) <\/em><\/strong>was established\nas an umbrella body under the support of RBI and the Indian Banks&#8217; Association.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a54fe46d4fb5\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a54fe46d4fb5\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/npci-guidelines-for-upi-apps\/#NPCI_%E2%80%93_An_Overview\" title=\"NPCI \u2013 An Overview\">NPCI \u2013 An Overview<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/npci-guidelines-for-upi-apps\/#Roles_Responsibility_of_NPCI\" title=\"Roles &amp; Responsibility of NPCI\">Roles &amp; Responsibility of NPCI<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/npci-guidelines-for-upi-apps\/#What_are_the_NPCI_Guidelines_for_UPI_Apps\" title=\"What are the NPCI Guidelines for UPI Apps?\">What are the NPCI Guidelines for UPI Apps?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/npci-guidelines-for-upi-apps\/#Conclusion_%E2%80%93_NPCI_Guidelines_for_UPI_Apps\" title=\"Conclusion &#8211;\nNPCI Guidelines for UPI Apps\">Conclusion &#8211;\nNPCI Guidelines for UPI Apps<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"NPCI_%E2%80%93_An_Overview\"><\/span>NPCI \u2013 An Overview<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>NPCI\nwas established in 2008 as a Section 25 (Non-for-Profit) company under the\nCompanies Act, 1956 (currently Section 8 of the Companies Act, 2013) with the\nvision to serve all member banks &amp; their clients, build infrastructure for\nworking PAN Indian systems with high availability &amp; scalability to process\nincreasing volumes of retail electronic payments.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Roles_Responsibility_of_NPCI\"><\/span>Roles &amp; Responsibility of NPCI<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul><li>The primary goal of NPCI is to\ncombine different systems with varying service levels and standard business\nprocedures for all physical &amp; digital payment and settlement systems.<\/li><li>&nbsp;It also aims to offer a cost-effective payment\nmethod that benefits the country\u2019s people and encourages financial inclusion. The\nUPI network\u2019s owner, service provider, coordinator, and network operator are\nNPCI. <\/li><li>It has the right to run &amp;\nmaintain the UPI network on its own or to contract with 3<sup>rd<\/sup> party\nservice providers to deliver or perform vital services.<\/li><li>NPCI maintains the right to\nexamine its members\u2019 UPI-related systems (comprising &amp; software) as and\nwhen it considers right, either internally or externally. Moreover, each member\nshould perform annually internal audits &amp; make sure that its processing\nagent, if any, follow the UPI Procedural Guidelines &amp; members should submit\nthe audit report every year to NPCI.<\/li><li>Apart from that, the Reserve\nBank of India may conduct or have conducted examinations &amp; audits of PSP to\nexecute its functions under the PSS Act, 2007, and it shall be the responsibility\nof the PSP to help the RBI in performing such inspections &amp; audits.<\/li><li>If members infringe the NPCI\nguidelines, the NPCI retains the right to penalise them. Fines may be charged\nas part of the penalty, as determined by the <strong><em>UPI Steering Committee<\/em><\/strong>\nfrom time to time.<\/li><li>The Bank or PSP will handle any\nclient grievances regarding non-refunds for failed transactions or\/and non-credit\nfor successful transactions. As per the rules published by NPCI from time to\ntime, any grievance about credit not being provided to a beneficiary shall be\nresolved decisively and bilaterally by the allowing &amp; beneficiary banks.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_NPCI_Guidelines_for_UPI_Apps\"><\/span>What are the NPCI Guidelines for UPI Apps?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Concerning\nthe regulations, there exist the NPCI guidelines for UPI apps. These NPCI\nguidelines for UPI are framed under the provisions of the PSS Act, 2007. <\/p>\n\n\n\n<p>These\nNPCI guidelines for UPI are binding in nature, and thus every member of UPI\n(Unified Payment Interface) has to abide by them. There are three broad\nnecessities given by the guidelines to become a UPI member, and you can check\nthe same below:<\/p>\n\n\n\n<ol><li>The company willing to deliver mobile banking services will come under the RBI regulation under the <strong>Banking Regulations Act, 1949<\/strong><sup><a href=\"https:\/\/rbidocs.rbi.org.in\/rdocs\/Publications\/PDFs\/BANKI15122014.PDF\" class=\"text-primary\"><strong>[1]<\/strong><\/a><\/sup>.<\/li><li>The member should endure by all certification necessities, procedural guidelines, risk and operating circulars and NPCI guidelines for UPI issued time to time.<\/li><li>The bank should be live on IMPS (Immediate Payment Service).<\/li><\/ol>\n\n\n\n<p>The\nUPI ecosystem is aimed at banks as only banks are permitted to interact with\nthe UPI switch. This doesn&#8217;t vitiate the opportunity of Non-Banking Organisations\nto carry transactions in this ecosystem. They have to obey one extra\nrequirement and have to partner with any banking organisation which has enabled\nUPI.<\/p>\n\n\n\n<p>Once\nthe bank enabled UPI agrees, the company can create their Payment Service\nProvider (PSP), which is recognised as a 3<sup>rd<\/sup> party application. The\npartnered banks are entirely responsible for all the financial &amp; operation\nliability of these applications.<\/p>\n\n\n\n<p>The\ndata of clients should be maintained by the banks, and the merchant app\nshouldn&#8217;t have access to it. The payment concerning the responsive data,\ncredentials should by no means reach these merchant apps and only exist in the\nUPI system of the bank. It imposes accountability on the bank for the proper\nfunctioning of the apps and to make sure that the application assists supports\nall versions of Android and iOS.<\/p>\n\n\n\n<p>These\nNPCI guidelines also offer freedom to the client for downloading any\napplication as they want. Clients can have two applications in a single device,\nand no application should obstruct the working of the other while installing,\noperating or any function done by the application. In the current condition,\nthe application is compulsory for android and iOS devices but optional for\nwindows.<\/p>\n\n\n\n<p>The present members can be suspended or terminated anytime from undertaking the functions by NPCI if the member fails to obey any UPI or NPCI product, procedural NPCI guidelines for UPI or any provisions by RBI or NPCI. It can further be terminated if the member&#8217;s RTGS account with the Reserve Bank of India is suspended by the Central Banks. Moreover, in the case where the member bank is amalgamated or combined with another member bank, the membership is terminated or suspended. At last, if the Reserve Bank of India suspends the consent of the mobile application, then the also merchant stops being a member.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion_%E2%80%93_NPCI_Guidelines_for_UPI_Apps\"><\/span>Conclusion &#8211;\nNPCI Guidelines for UPI Apps<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>After\ndiscussing the NPCI Guidelines for UPI Apps and a thorough examination of the\nUPI system, we can conclude that India is taking vital and excellent moves\ntoward digitalisation. These procedures &amp; policies are well-thought-out,\ncomplete and yet prudent. The widespread surveillance system offers total\nsecurity &amp; eliminates the possibility of human errors. The procedural\nguidelines are to take precautions to protect the client. The obligation of\nresponsibility on banks for any discrepancies increases the confidence &amp;\ntrust of the people in these online platforms.<\/p>\n\n\n\n<p>The recent case study of WhatsApps emphasises the processes that a UPI payment platform should go through to get RBI &amp; NPCI consent. Acceptance of such platforms can even be approved in a law court, making the judiciary the 3<sup>rd<\/sup> line of protection.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/micro-financing-scheme-of-nmdfc-in-india\/\">Micro Financing Scheme of NMDFC in India \u2013 A Complete Guide<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In recent years the digital payments have experienced rapid growth in India. Regardless of the Covid-19 pandemic and its economic impact, around 48 billion digital transactions were reported in the Calendar Year. Overall the total online transaction volume in 2020-21 was 4,371 crore, up from 3,412 crores in 2019-20, as per the annual report 2020-21 [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":7535,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[56],"tags":[805],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/7534"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=7534"}],"version-history":[{"count":7,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/7534\/revisions"}],"predecessor-version":[{"id":7543,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/7534\/revisions\/7543"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/7535"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=7534"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=7534"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=7534"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}