A major outage in India's Unified Payments Interface (UPI) system disrupted financial transactions nationwide on Wednesday, leaving users unable to make payments through popular UPI apps like Google Pay, PhonePe, and Paytm.
The issue triggered a significant increase in complaints on Downdetector, a platform that monitors service disruptions based on user reports.
While some banks, such as ICICI, managed to maintain operational services during the outage, others, including HDFC Bank, faced difficulties. The disruption caused inconvenience to millions of users who rely on UPI for daily transactions, from small payments at local shops to larger online transfers.
UPI, developed by the National Payments Corporation of India (NPCI) and regulated by the Reserve Bank of India (RBI), has revolutionised digital payments in the country. It enables users to transfer funds instantly through their phone numbers or unique UPI IDs.
Unlike traditional methods like National Electronic Funds Transfer (NEFT) and Immediate Payment Service (IMPS), UPI also allows users to request payments effortlessly through their banking apps.
One of the reasons behind UPI's widespread success is its cost-free nature. There are no additional fees imposed by the NPCI for transactions, making it accessible to all, regardless of the amount being transferred. Its user-friendly features, including AutoPay for recurring payments, further simplify transactions.
Different UPI apps generate distinct UPI IDs based on their banking partners, leading to variations such as "@oksbi," "@okhdfcbank," "@okaxis," and "@okicici." This variation depends on the bank linked to the user's account, enhancing the versatility of the system.
Despite its simplicity and efficiency, UPI has robust security measures to protect users' funds and data. Advanced encryption technologies like TLS, AES, and PKI safeguard sensitive information during transmission.
Additionally, UPI relies on a Virtual Payment Address (VPA) instead of exposing bank account details, reducing the risk of unauthorised access.
To further secure transactions, UPI is designed to work only on registered devices, and users must authenticate with two-factor authentication (2FA) or biometric verification. The RBI strictly enforces these safety protocols to ensure secure and reliable transactions.
However, the NPCI's assurance that UPI accounts cannot be hacked does not eliminate the risks of fraud entirely. In 2022 alone, over 95,000 cases of UPI-related fraud were reported, often resulting from scammers tricking users into sharing confidential information or granting access to their devices.
The recent outage has raised concerns among users, especially as digital transactions increasingly become the backbone of India's economy. With UPI handling billions of transactions monthly, any disruption significantly impacts businesses and individuals alike.
As of now, the cause of the outage has not been officially confirmed, and there is no statement from the NPCI or RBI regarding the incident. Users are advised to stay cautious while making online transactions and avoid sharing sensitive information to protect against potential frauds.
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