According to RBI, UPI Payments will cross 999.57 million transaction volume in April 2021. Nowadays, accepting UPI payments for businesses is necessary. In this blog, we will give you a detailed overview of how you, as a business owner, can use UPI to facilitate your business transactions.

In one of Cashfree’s previous blogs, we covered the concept of VPA in UPI. It listed out the advantages of UPI infrastructure for customers. In this blog, we will dive deeper into UPI’s wide range of business applications. 

However, before we get to the guide, let’s put your knowledge to the test!

Advantages of UPI Transaction on PG For Businesses

So, do businesses benefit from using the UPI infrastructure?

The short answer is YES.

The detailed answer is as follows:

1. Easy Reconciliation through the Dashboard

Reconciliation is a breeze when it comes to UPI transactions. Once you receive the payment, you are instantly notified about the transaction and payment details via webhooks. 

With Cashfree, you can track all your settlements in one single place. The dashboard will allow you to keep track of all settlements. 

Moreover, you can choose to customize the reports of your UPI transactions by applying filters. This will help you track the status of settlements within a certain period of time as well. 

Furthermore, you can check the settlement status of particular orders by entering their order IDs. 

2. Lower Transaction Fees

A payment gateway makes life easier for a merchant. You don’t have to worry about creating partnerships with different banks in different countries. The time and resources saved on skipping NDAs and enhanced due diligence is definitely a highlight. Of course, this is in addition to the resources that would have been spent on creating and processing the contracts. 

A payment gateway takes care of these tasks for you while providing you with different modes of payment including UPI payments for the business.

What do they charge in return?

The Merchant Discount Rate (TDR)

Alternatively called the Merchant Discount Range (MDR) is a small transaction fee that you have to pay on every transaction via the PG. 

Interestingly, this rate differs according to the payment mode used by your customer. UPI transactions tend to have the lowest TDRs of all the payment modes. Usually, a platform or risk fee is charged to handle settlements, refunds and disputes, instead of a transaction processing fee. 

3. High Transaction Limits

NPCI has set the limits for UPI transactions at 1 Lakh per transaction. This limit varies from one bank to another. For P2P (peer-to-peer) transactions, the limit is 10 transactions per day. However, this transaction limit is not applicable for P2M (peer-to-merchant) transactions.

However, these UPI limits do not apply if you are using a payment gateway. You can make any amount of transaction any number of times. In fact, with Cashfree, you can choose to specify the transaction in terms of frequency and amount.

4. Faster Settlement Cycles

A payment gateway settlement is a process of crediting the payments made by the customer to the merchant’s account.

Cashfree PG offers you two kinds of settlement cycles for your UPI transactions: Instant and Standard.

The standard settlement cycle is of T+2 days. This kind of settlement only happens on bank working days. 

On the other hand, Instant settlements cycles allow you to access funds in 15 minutes. These settlements can happen on bank holidays as well. 

Industries Using the UPI Infrastructure


Using the UPI infrastructure with a payment gateway can help you automate premium collections. Moreover, you can offer disbursals seamlessly. This can be payouts to agents and intermediaries.  

You can use UPI ID verification during policyholder onboarding. This will ensure that the customer’s bank details are correct and thus decrease the chances of payment failures. 

Thereafter, UPI or link-based payments can be used for premium collection & reconciliation. In fact, UPI Autopay often helps in the collection of recurring payments. You can enable recurring payments over a debit card or bank account via Emandate through any UPI app. 

Moreover, you can use virtual accounts to collect payments via Google Pay, Paytm, WhatsApp etc. For this, you can create virtual UPI IDs and bank accounts. This will allow for same-day settlement and instant reconciliation.


Education and ed-tech institutions can use UPI infrastructure for website/in-app fees and donation payment collection. The Payment Gateway dashboard can help you keep track of all these transactions.

Moreover, a payment gateway can help you create unique virtual accounts or UPI IDs for each student to accept payments. These payments can be done through bank transfer or any UPI App. 


The UPI Payments for eCommerce businesses are a revolutionary development. UPI ID QR codes can help collect payments from customers. It can also be helpful for delivery agent-based payments. 

Needless to say, all these transactions can be reconciled with the help of the payment gateway dashboard. Moreover, UPI Autopay can be used for recurring payments. This is very useful to eCommerce companies that are running on a subscription model. 

Furthermore, the UPI infrastructure can allow faster-automated refunds as well. These refunds can be processed for online orders or COD orders. 

Payment gateways offer payment links for COD orders. Cashfree allows merchants to create payout links that can be sent to the customer via WhatsApp, SMS or email. Thereafter, a user can enter their UPI ID and receive the refund amount in the linked bank account.

How can you use UPI for your business needs?

UPI for collection

Integrate with a payment gateway that supports UPI flow

To simplify your payment processes, you can integrate with a payment gateway. However, you need to ensure that your payment gateway supports UPI flow. Ideally, this feature should work across web, iOS & Android platforms.

Thereafter, you can accept payments from UPI-enabled apps like Paytm, Google Pay, PhonePe etc. 

Cashfree offers the widest range of business applications for UPI including UPI Payment gateway, AutoCollect, and Cashfree Subscriptions with UPI Autopay (UPI recurring payments) with features like UPI ID Verification, among other features.

UPI Payments For Businesses

Collect in-app UPI payments

Today, customers are swiftly moving towards mobile payments. Chances are, mobile payments will increase in the near future.

Mobile app UPI integration will allow your customers to make UPI payments through their cell phones. In addition to that, the customer experience will improve drastically due to a faster checkout experience.

UPI Payments For Businesses

Payment links allow businesses to generate a link that can be easily shared with their customer over WhatsApp, email or SMS. 

You can also choose to send a UPI payment link to collect payments.

UPI Payments For Businesses

Collect payments via UPI dynamic QR codes

If we are on the topic of simplifying payments, QR codes definitely deserve a mention!

UPI Quick Response (QR) Code is a graphic code that helps accept payments through UPI. These codes can be static or dynamic.

The static QR code has fixed information. However, the dynamic code is editable by the business for each specific instance. In dynamic code, the payment amount is auto-filled. 

All the customer has to do is scan the dynamic QR code and voila! 

All the payment details are on the screen and this payment can be done instantaneously. 

UPI Payments For Businesses

Offer subscription plans by enabling UPI e-mandate

You can also create subscription plans for your customers and allow your customers to enable auto-debit on their UPI-linked bank account. This can be enabled by doing a one-time UPI mandate authentication by the user. These payments can be set for weekly, yearly or monthly transactions. 

The customer doesn’t need to worry about the payment schedule and yet never misses a date! 

Create virtual UPI addresses for reconciliation

Remember the P2M- Virtual VPAs we discussed in our blog on VPA in UPI?

Well, they can come in handy when it comes to UPI payments for businesses. Through P2M-V VPAs (Also called virtual UPI IDs), reconciling payments becomes a breeze since each VPA is mapped to a unique user.

Cashfree launches Virtual UPI IDs for easy reconciliation

I hope this section gave you a complete rundown on how you can accept UPI payments for all your business needs.

However, businesses don’t just have to deal with payment collection. They also need a solid payment disbursal system. 

Thankfully, UPI can be used to do payment disbursals and issue refunds to customers as well.

UPI for disbursal

UPI VPA verification

Incorrect bank account details are one of the primary reasons for bank transfer failures. Similarly, in the case of UPI transfers, an invalid VPA may lead to transaction failure. In fact, the amount may get credited to the wrong beneficiary account. 

To avoid such instances, businesses can do UPI VPA verification. 

To validate the VPA in UPI, businesses can make a small amount of transfer (also called a token amount). The verification process will ensure that the name of the account holder is the same as the bank record. Moreover, it will verify if the VPA is valid or not. 

Cashfree allows you to verify the UPI VPA in a matter of minutes!

UPI Payments For Businesses

Automate businesses payment reconciliation

Businesses need to transfer amounts in bulk to other businesses like suppliers, vendors and other partners. Moreover, they need to refund money in several cases. This makes the reconciliation process extremely tedious. 

After all, manual cross-checking can only take us so far.

This is where P2M-Virtual (or Virtual UPI IDs) come to the rescue again. They can help businesses send money in bulk transfer and reconciliation is done automatically through webhooks.

UPI Payments For Businesses

Now, this will give you a very clear idea of WHAT you can do when allowing/making UPI payments.

But, we are yet to cover the HOW.

There are many ways through which you can offer UPI as a payment option to customers. Naturally, the same kind of payment option and platforms is not suited to all.

Once you have decided which payment provider suits you best, the real work begins. You can accept UPI payments by integrating UPI as a payment option on your website. 

Accepting UPI payments on websites

To accept UPI payments, you have to choose a UPI integration. There are different types of UPI integration which results in different checkout flows. 

The checkout flow plays a huge role in whether the customer will end up completing the purchase or not.

So, the UPI integration that you choose should be in line with your budget and your customer’s expectations.

Let’s have a look at the different UPI integrations that you can choose from:

Webflow UPI integration

This is the most popular and economical of UPI integrations. It will allow you to accept UPI payments rather seamlessly.

If you are applying the Webflow UPI integration, your customers will:

  1. Select the item and fill in all the necessary details (like shipping address/delivery instructions)
  2. Select UPI as payment mode and enter their VPA. The VPA is then verified and submitted.
  3. Complete the two-way authentication. The authentication will include the thumb impression/phone passcode and the UPI PIN.

UPI Google Pay integration

The Gpay UPI integration is rather similar to the Webflow UPI integration. However, here the customer enters the mobile number instead of the VPA.

Here, the customer will:

  1. Enter the mobile number
  2. Do the 2-factor authentication 
  3. Complete the payment.

Intent flow UPI integration

This integration offers a frictionless experience to customers because the UPI app is launched automatically.

  1. The user does not need to enter the VPA or amount details as it is auto-filled. 
  2. After the 2-factor authentication, payment is completed. 

UPI SDK Flow integration

If you choose to use the UPI SDK, the customer can make the payment without opening the 3rd party app. This kind of integration is offered by banks like ICICI, Yes Bank, Axis Bank etc. 

  1. Here, the bank will create the VPA for you and customers will pay you on that VPA. You will need to add the UPI SDK to your mobile app/website to allow the UPI transaction.
  2. Most importantly, your customers will not need to redirect to any 3rd party UPI app. Resultantly, your conversion rate increases.

NEW: Cashfree now offers UPI SDK integration as well. Get in touch here

Dynamic QR code

We mentioned the QR code in the section before this one. With a dynamic QR code, you can:

  1. Create a tailor-made QR code for each customer. 
  2. The customer opens any UPI app, scans the code and pays.

AutoCollect to collect and reconcile payments

In all of the aforementioned integrations, the merchant has a website or an app. The customer visits the app/site and then starts the payment.

But, what if the business does not have a website? 

Well, in this case, Autocollect can come handy.

We discussed using UPI payments to offer subscription plans by e-mandate. Autocollect makes that a reality. 

Autocollect creates custom VPA aliases for each customer. This way, the payments are very easy to reconcile. 

To learn more about UPI integration, head over to this exhaustive guide!

….but what if you don’t know the UPI ID?

In many cases, the UPI ID of the beneficiary is not known. Here, Cashfree’s Cashgram services come to the rescue. The merchant can choose to give the beneficiary a payment link with a predetermined amount. Thereafter, the customer can choose whichever payment method they want.

Improve the Success Rate of Transactions through UPI

If you have read the blog till now, we are sure you understand one thing.

There are a lot of players at work here. Moreover, every transaction requires several steps to complete. 

Naturally, a lot of things can go wrong.

So, how do we ensure that  UPI payments for businesses are successful?

Well, here are some tips that might help:

General tips

  • Businesses need to use multiple acquiring banks. This will allow smart/dynamic routing based on availability and performance
  • As a business owner, you need to be proactive. If any particular UPI app or bank is having issues, inform the customer with advance warning messages

Tips specific to Collect Flow:

  • Validate the VPA before initiating the payment. Allow token payment
  • Include a dynamic UPI QR code. This will ensure that the user doesn’t have to add the amount/VPA
  • On the website, include a UPI QR code so the user doesn’t have to type their VPA. They can just scan the UPI QR Code
  • Save the VPA of customers that have had successful transactions. This way, they wouldn’t need to add it again
  • Include a timer that shows the expiry limit of the collect request. This will urge the customer to make the payment faster
  • You can also utilize the wait page to inform the customer about the next steps (which app they will receive a notification on / they have to enter the UPI PIN etc.)

Tips specific to Intent Flow:

  • Only show efficient apps to your customers. You can choose to blacklist apps that are unreliable or have very low transaction success rates.
  • Consider implementing Intent Flow for mobile apps as it has a higher success rate.

We hope that this guide has been helpful to you.

To know more about UPI payments for businesses, head over to the Cashfree Payments Stack For Businesses.