It feels like magic — a tap, a click, and money moves instantly. But behind the scenes, there’s an incredible ecosystem at work.
🔑 First things first: UPI = Unified Payments Interface ➡️ It’s just an interface, managed by NPCI (National Payments Corporation of India), built on top of IMPS & AEPS for real-time settlement.
Here’s who makes UPI work:
🏦 NPCI (The Brain)
- Owns & operates UPI
- Sets rules, guidelines & ensures settlement between banks
- Approves participants (Banks, PSPs, TPAPs, PPIs)
- Ensures security, audits & dispute handling
📲 PSP – Payment Service Providers (The Bridge)
- Usually a bank connecting to UPI
- Onboards users via their app or TPAP’s app
- Handles authentication, account linking & security
- Stores UPI data only in India
- Provides grievance redressal mechanisms
🤝 TPAP – Third Party Application Providers (The Face)
- Apps like Google Pay, PhonePe, Paytm etc.
- Work through PSP banks to offer UPI services
- Must follow NPCI & PSP guidelines
- Handle user complaints & data security
⚖️ Dispute Redressal
- User → TPAP → PSP → Bank → NPCI → Ombudsman
- Both fund transfers & merchant transactions covered
- Transparency ensured via in-app updates
✨ So next time you scan a QR and pay, remember — it’s not “just” an app. It’s a well-oiled collaboration between NPCI + Banks (PSP) + Apps (TPAP) ensuring speed, security & reliability.
India didn’t just build a payment system — we built a global benchmark. 🚀
🔗 References: Razorpay Blog | Google Pay - NPCI