DC Edit | Ensure UPI remains glitch-free

United Payments Interface (UPI), the most ubiquitous invention from India in the payments space, experienced outages three times in April — the most in a single month — disrupting trade and raising concerns among the public.

The RBI-led National Payments Corporation of India launched UPI in 2016 as an alternative to cash payments in the country. However, UPI gained wider acceptance after the Covid-19 pandemic set in in March 2020, after fears were raised about the possibility of the coronavirus being transmitted through currency notes.

According to estimates, UPI was used to make 65 per cent of digital payments in India. It processed 1,200 crore transactions in March alone. As it is accepted at both premium stores and tea stalls, UPI has almost eliminated the need for people to carry cash or wallets while shopping, making it an indispensable payment infrastructure. In such a scenario, frequent UPI glitches — such as those seen this month on April 1, April 2, and April 12 — could cause outrage among lakhs of people.

On the flipside, no technical solution can be a 100 per cent foolproof system, and a marginal deviation should be considered acceptable. In the last five years — 1,827 days or approximately 26,28,000 minutes — when UPI gained wider acceptance, the payment system experienced disruptions 21 times, or for approximately 1,200 minutes. The failure rate of UPI stands at 0.045 per cent, while its success rate is 99.955 per cent — an impeccable record.

Nevertheless, as people’s dependence on digital payments has increased considerably in the past five years, the government should make payment intermediaries like PayTM, PhonePe, and Google Pay include Central Bank Digital Currency (CBDC), or the digital rupee, as an alternative payment option in their mobile apps. Whenever the UPI system does not function, the apps could seamlessly switch to the digital rupee to facilitate payments. However, nothing beats cash, so carry a wallet.

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