On May 30, the fintech unicorn Razorpay, in collaboration with Axis Bank and the National Payments Council of India (NPCI), unveiled Turbo UPI, a new payment solution. The objective of Turbo UPI is to enhance the speed of UPI payments and reduce the occurrence of payment failures. Merchants can seamlessly integrate Turbo UPI into their payment gateway, eliminating the need for customers to use third-party UPI payment apps.
This allows customers to directly make payments from their UPI-linked bank accounts within the merchant app. By removing the extra step of switching between apps, which is responsible for approximately 5-10 percent of payment failures, Turbo UPI aims to provide a smoother payment experience.
Recently, Paytm, another player with a payment gateway solution, introduced a similar product called “UPI SDK.” Paytm’s product supports UPI payments through UPI Lite and Rupay Credit Cards linked to the UPI account. SDK, short for software development kit, refers to a software plug-in that merchants can integrate with their payment gateway.
Shashank Kumar, co-founder and Managing Director of Razorpay, explained, “This is a one-click process, and the payment is completed much faster. No PSPs (payment service providers) are required as the merchant app itself becomes a UPI App. Merchants can install a Razorpay Plug-in, and customers can directly link their bank accounts to the merchant app.” Using a third-party app like Google Pay or PhonePe for payments often involves additional steps that can make the process cumbersome. Delayed messages or notifications for payment prompts may cause customers to miss payments.
Consequently, some major digital merchants prefer to develop their own UPI payment solutions. For instance, Amazon has Amazon Pay UPI, Zomato recently launched Zomato UPI, and Flipkart has plans to introduce its own UPI payment solution. Razorpay claims that Turbo UPI can boost the success rate of UPI payments for businesses by up to 10 percent. The product also offers merchants insights into customer drop-off patterns, enabling them to control the end-to-end payment experience.
While Turbo UPI is currently in the pilot stage, Razorpay revealed that popular apps such as Tata StarQuik, Ixigo, FNP (Ferns N Petals), Trainman, and Dhan, among others, will soon adopt this product on their platforms. Over the next couple of years, Razorpay anticipates more than a thousand merchants to enable this feature.
Kumar added, “Based on the intelligence and data gathered by our banking partner, Axis Bank, we will pre-select the bank accounts if the customer has multiple accounts.” UPI accounts for 56 percent of Razorpay’s digital payments, underscoring the significance of this feature for its merchant partners.