As the major step has been taken to move towards cashless economy, it is time to go for mobile payment solutions. So, if you are wondering how to pay your maid, driver or vegetable vendor, just try to explain them how digital payment works.
Moreover, with 25 crore Jan Dhan accounts having been opened, people have an opportunity to move towards digitisation of cash. Pramod Saxena, Chairman and Managing Director, Oxigen, says, "Digitisation of cash will continue. Some of them who have bank accounts have an opportunity to digitise their money through wallets."
We outline some of the different ways to transfer money online.
A mobile wallet is a virtual wallet that can be used to pay for various services ranging from grocery bills to booking a rail ticket. You can zip through these apps by using your username and password without parting with your credit and debit card details each time you do a transaction. Your driver, maid and a vegetable vendor need to have a mobile wallet of the same company and money can be smoothly transferred from one account to the other.
To get started with a wallet you first need to download and sign up for the app on your iPhone, Android or Windows phone. You then load it with money either by a debit/ credit card or net banking. After loading it with money you can use it to transfer money, pay bills, booking tickets and shopping. You do not need to have bank details of the person as through these apps you can transfer money simply using phone number or email id. You can also use mobile wallets to make a payment at physical stores.
There are plenty of companies providing mobile wallet services such as Paytm, Oxigen, Mobikwik. Most of the banks also have their own wallets such as ICICI Bank launched its m-wallet called 'Pocket'. Next time you go for shopping, ask your merchant if you can transfer money through wallets.
UPI stands for Unified Payment Interface, which means a payment system with the help of which one can easily transfer money without mentioning any bank details, by just using a single virtual ID to perform transactions. According to NPCI, 21 banks have launched their UPI-enabled apps.
The Unified Payment Interface app allows transactions to be done through a smartphone with just a few taps, and making the process as simple as sending an e-mail using VPA-Virtual Payment Address. Unlike NEFT or RTGS, where services can be operated for a specific number of hours, through UPI app transactions can be done 24/7.
UPI has upper hand compared to wallets because money can be transferred immediately from one bank account to another. While in wallets such as Paytm money is circulated within their ecosystem. It works on virtual payment address as a payment mode for sending and receiving money and provides a single-click two-factor authentication solution. Authentication is done through single-click because your smartphone serves as the first authentication factor and password is the second.
Apart from the bank-enabled apps, there are mobile payment applications based on UPI such as Trupay. The app offers one touch pay-on-the-go and the facility to pay anyone, anytime directly through your bank account. There's no need to carry credit or debit cards to pay and unlike e-wallets, it doesn't even need top-ups.
One can also transfer money using online banking. But for immediate transfer of money UPI enabled apps seems to be the best bet among the given options.