India’s IP infrastructure enables users to transfer funds and make payments instantly, using the Immediate Payment Service (IMPS) or the Unified Payments Interface (UPI) — both launched by the National Payments Corporation of India (NPCI).
IMPS was the first IP interbank electronic funds transfer system in India. It launched in 2010 and operates around the clock. Supported by 243 banks and payment service providers, IMPS enables fund transfers via various channels, including online and mobile banking, ATM, SMS, branch and USSD. Funds can be transferred using a recipient’s bank account number and the Indian Financial System Code (IFSC), or their mobile number and Mobile Banking ID (MMID).
UPI launched in April 2016 and is built over the IMPS infrastructure. UPI integrates multiple bank accounts into a single mobile app, allowing for 24/7/365 instant money transfers initiated via mobile. It is supported by over 140 banks and PSPs and offers additional benefits over IMPS, such as simplified P2P and merchant payments, using mobile numbers or QR codes, and faster payments authentication. Perhaps due to the incremental benefits and user experience enhancements it offers, UPI has seen extraordinary adoption in the market. In 2018, UPI transaction volumes surpassed those of IMPS and last year UPI processed more than five times the number of IMPS transactions.