How does FedNow compare with UPI?

UPI (Unified Payments Interface) is India’s instant payment technology, launched in 2016. UPI is the underlying tech infrastructure enabling India to grow its fintech landscape exponentially. By 2020, UPI was processing 1 billion transactions a month!

UPI is one of India's most successful tech innovations and will continue to lead payment tech innovation.

FedNow is a new real-time payment system developed by the Federal Reserve Banks of the United States. The system was created to provide a faster, more efficient, and more secure way for individuals and businesses to make and receive payments.

FedNow and UPI (Unified Payments Interface) in India are real-time payment systems allowing users to make and receive payments instantly. However, there are some key differences between the two systems.

1. User base: UPI has a much larger user base than FedNow. As of February 2023, UPI had over 2.5 billion registered users, while FedNow is still in the early stages of adoption.
2. Availability: both UPI and FedNow will be available 24/7. FedNow is expected to be fully operational 24/7 by the end of 2023.
3. Transaction limits: UPI has transaction limits that vary based on the bank or payment provider, while FedNow currently has a limit of $25,000 per transaction.
4. Transfer modes: UPI allows users to transfer money using a mobile number, a virtual payment address (VPA), a bank account number, and an IFSC code. FedNow uses an email address or a mobile number to transfer funds.
5. Fees: Both systems charge transaction fees, but the fee structure differs. UPI charges a flat fee for transactions, while FedNow’s fees are based on the amount of the transaction and the type of user (e.g., individual or business).
6. Governance: UPI is governed by the National Payments Corporation of India (NPCI), while the Federal Reserve Banks of the United States operate FedNow.