{"id":1139,"date":"2020-11-04T20:52:37","date_gmt":"2020-11-04T15:22:37","guid":{"rendered":"https:\/\/open.money\/blog\/?p=1139"},"modified":"2023-03-17T17:38:23","modified_gmt":"2023-03-17T12:08:23","slug":"enable-recurring-payments-using-upi-autopay","status":"publish","type":"post","link":"https:\/\/open.money\/blog\/enable-recurring-payments-using-upi-autopay\/","title":{"rendered":"Open to revolutionize recurring payments for small businesses with UPI AutoPay"},"content":{"rendered":"In January 2020, the <\/span>RBI extended the recurring payments feature to UPI<\/span>. Since then, UPI AutoPay has been one of the most awaited features for many small businesses in India. Till now, that is. We circle back to this later, but let’s set the context first.<\/span>\r\n\r\nRecurring payments are nothing but the subscriptions that you as a business or service provider collect from your customers on a timely basis (daily\/ weekly\/ monthly or yearly). This can be monthly school fees, gym membership fees, insurance premiums, SAAS & OTT subscriptions, EMI payments, etc.<\/span>\r\n\r\nFrom the day the first transaction was initiated, UPI transactions volume has grown by leaps and bounds. Having recorded close to 2 billion transactions in October 2020, NPCI is about to mark the 2X year-on-year growth for UPI payments. After seeing the rapid rise in UPI adoption in such a short time period, <\/span>NPCI announced UPI AutoPay<\/a> feature<\/span> during the Global FinTech Fest 2020. It is widely accepted as the best method to collect recurring payments as it provides a much better user experience & transparency to the customers.<\/span>\r\n

What is UPI AutoPay?<\/strong><\/span><\/h2>\r\nUPI AutoPay<\/a> is a feature that allows customers to do recurring payments<\/a> using any UPI application. Customers can now enable e-mandate for recurring payments, such as mobile bills, electricity bills, EMI payments, entertainment\/OTT subscriptions, insurance, mutual funds, among others.<\/span>\r\n
\"Indian<\/span><\/h6>\r\nUntil recently, you as a customer could only use credit cards to make recurring payments. While you could use debit cards earlier, RBI recently put that facility on hold due to security issues & fraud cases. The auto-debit feature by UPI will empower customers to do away with payment authentication time & again.\u00a0<\/span>\r\n\r\nIn the realm of small business banking, <\/span>Open is the first to roll out UPI AutoPay feature<\/span> to its users. Recurring payments turned out to be the biggest pain point for small businesses due to continuous lockdowns that happened due to the spread of COVID. Merchants had a tough time collecting subscriptions due to social distancing and movement restrictions. Enabling this feature will help small businesses automate their payment collections so that they can stay safe & focus on their business.\u00a0\u00a0<\/span>\r\n\r\n\"Praveena<\/span>\r\n\r\nUPI AutoPay helps businesses as they can generate mandate instantly and send it to customers for authorization. Once the customer approves it, a fixed amount gets deducted automatically on the authorized date.<\/span>\r\n

What are the benefits of UPI AutoPay?<\/strong><\/span><\/h2>\r\nUPI AutoPay will empower users by providing them with a comfortable and secure way of making recurring payments. Here are some main benefits of this feature:<\/span>\r\n

(1) Recurring payments get activated with a onetime authorization<\/strong><\/span><\/h3>\r\nWith UPI AutoPay, customers can pre-authorize (onetime activity) & make payments<\/a> on a particular date. Once you\u2019ve generated the mandate, the payments will get deducted automatically on the authorized date. These mandates can now be instantly generated & require onetime authorization.<\/span>\r\n

(2) Real-time mandate confirmation<\/strong><\/span><\/h3>\r\nTill recently, to enable recurring payments, one had to wait anywhere between two days to two weeks. UPI AutoPay, on the other hand, gives you a real-time mandate confirmation. Now you can set mandates irrespective of the payment frequency – onetime, daily, weekly, fortnightly, monthly, bi-monthly, quarterly, half-yearly, and yearly.<\/span>\r\n

(3) Grow your customer base<\/b><\/span><\/h3>\r\nEarlier, subscription-led businesses could only process recurring payments through credit cards. Hence they couldn’t target a large section of the demographic who don’t possess a credit card.<\/span>\r\n\r\nUPI AutoPay helps merchants reach out to a new segment of customers who can now make recurring payments directly via their UPI applications.<\/span>\r\n

(4) Lower chargebacks due to complete transparency<\/strong><\/span><\/h3>\r\nThis feature allows customers to view, suspend, or revoke a digital mandate via their UPI application. This results in lower chargebacks. Merchants will be notified in real-time once this action is taken by customers.<\/span>\r\n

(5) Better success rates<\/strong><\/span><\/h3>\r\nUPI AutoPay feature improves the success rate, as customers will receive a pre-debit notification one day before the debit occurs. This will provide customers with enough time to arrange funds to ensure that the auto-debit transactions are successful.<\/span>\r\n

(6) Timely payments<\/strong><\/span><\/h3>\r\nWith this feature, you can automate bill payments, which in turn ensures that payment collection is done on time. These automatic & timely payments will help customers improve their credit score.<\/span>\r\n

How does UPI AutoPay work?<\/strong><\/span><\/h2>\r\nThe autopay request initiated by merchants has these four important steps to it:\r\n\r\n