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Revolutionizing Payments: Unveiling the Power and Potential of UPI

The teens at the Young Writers' Club participated in an exploratory discussion about this mode of payment, the central bank's purpose behind driving this initiative and cashless economy.

The above picture shows something so familiar and so common. All the teens at some point had either used cashless payments themselves or had seen someone else use it. They spoke about QR code technology and about its application other then for payments.

Cash vs using a cashless mode of payment

“How do you pay when you go to a store?” is the question that set the ball rolling for a group discussion that started on a reflective note. Every teen on the group tried to recollect their experiences while shopping at a store and consciously compared the experience of using cash vs cashless mode of payment such as the Unified Payment Interface (UPI) system based apps in India. While majority felt that UPI saved them from the hassle of not having exact change, one teen pointed out that he hasn’t had the need to use UPI as the vendors in his neighbourhood generally have change for small payments.

Holding cash is a hassle on other accounts as well.

“It is easy to lose cash. It may fall out of the pocket unless it is kept in a wallet.”

“Using credit cards instead of cash though convenient tends to lead to over spending. We may not realise how much we have spent until the credit card bill comes. But having limited cash on person, automatically provides a tangible budget.”

“That hasn’t been the case in my experience. On a school trip with friends, I had extra cash and somehow I did not realise that I was spending it all. Teen credit cards are now available with a specified limit. This would have been very useful for me during this trip. I would have the feeling of security that I have a card in case I need money and at the same time, I would have been conscious of the limit.” (The limit on the card perhaps can be adjusted online by the parent if the absolute need arises. This makes it easy to set low limits encouraging careful spending.)

“It almost feels like I earned the limit and hence it is likely that I will be more careful with spending.”

“Credit card vs Debit card…I know the credit card has a limit and is good as one cannot exceed the limit. What is a debit card? I am not sure what that means.”

Facilitator: Using a debit card would mean that the amount spent on the card is immediately deducted from your bank account.

“That is risky. If you lose your debit card, your account could get emptied if you haven’t noticed that your card has gone missing. Of course there is a pin involved. But what if someone makes that pin easily available to access? Like a note in their purse?”

“That’s worse than losing a credit card.”

“Paying by cash would mean that we still use our skills of adding and subtracting.”

“If we lose cash, we would lose the amount in our pocket not large amounts as in the case of credit cards and debit cards.”

“Also with cash, transactions cannot be traced!”

“That’s true, when I was younger, I made use of Rs.10 or Rs.20 notes lying around to get myself an icecream. No one found out I think:)”

What’s your experience with UPI?

“It is dependent on the internet. There have been instances when it didn’t work on account of poor internet. My father gives me his phone to use when I need to make a UPI payment at the store. I always worry that I might forget the pin or do something wrong.”

“It is hassle free unless the phone gets lost.”

“But finding the pin to open the phone and then accessing the UPI app would be challenging, making it safer than cash.”

“If the person who finds the phone wants to steal, if he is able to crack the phone code he could seek to change his pin for the UPI payment.”

“But that’s not going to be easy to change the pin.”

“Which makes it a little more tense, if you forget the pin!”

Latest news announcements by the Reserve Bank of India (RBI)- answers to all our issues about using UPI

A remarkably successful initiative:

With the purpose of enabling a complete cashless and digital payment based economy, the RBI has been taking several steps to make UPI payments as seamless as possible. Numbers reflect the remarkable success of the UPI. UPI came into existence in April of 2016. Since then, as of June 2022, transactions have more than doubled to Rs. 5.86 billion. A new feature was also introduced to enable people without smart phones but with the old phones with buttons to also use UPI.

UPI Lite takes care of issues such as lack of internet or the tendency to forget pin.

RBI launched UPI lite in September 2022. UPI lite today enables offline payment without pin upto Rs.500. The limit used to be Rs.200 but the central bank recently increased to Rs.500. This facilitates small transactions especially in local stores across the country even in places were internet access is poor. No issue of forgetting the pin too!

Using Artificial Intelligence (AI) to the advantage of UPI and enhancing security in the process

India being a country of multiple languages, RBI is also planning to soon enable voice activated UPI using AI. To begin with this facility will be available in English and Hindi and later in the regional languages too. Voice activated UPI renders it more difficult for someone to use a stolen phone and make payments. Additionally, this could help illiterate people to use UPI with ease.

Inter country payment transfers using UPI is possible now.

Having become an extremely convenient mode of payment in the country, there was immense demand to enable international transactions as well. While travelling to a designated list of countries, it is said that one can use UPI. Details here.

Apart from hassle free payments and more security, UPI is likely to play a monumental role in bringing about a lot more transparency by achieving a cashless economy. Going completely cashless is going to take time but given the success of UPI it is not impossible. The easier this interface becomes, it is only going to see a large proportion of the population making the shift. A cashless economy would mean that all payments can be easily traced leaving little room for black money and corruption.


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Both weekday and weekend batches are available at the Young Readers' Club. While this program is for the 8-12 age group, the Young Writers' Club program for the 13-15 age group offers a weekly platform to read and discuss curated articles from the news, observe writing approaches and practise one's writing skills.

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