NPCI to launch UPI for secondary-market on January 1

National Payments Corporation of India (NPCI) is going to launch the Unified Payment Interface (UPI) for the secondary market from January 1, 2024. After this, investors may be able to purchase shares by paying through UPI.

Currently, in the bidding of Initial Public Offering i.e. IPO, payment can be made through UPI. When applying for IPO, the money is blocked in the investor's account and the amount is debited when shares are issued.

Similarly, after the launch of this service in the secondary market i.e. stock market, the amount of stock purchased will be blocked in your account. After this, when the settlement takes place on the same day, the money will be debited from the investors' account.

NPCI said that the payment service will be introduced in a beta version for the equity cash segment in collaboration with clearing corporations, stock exchanges, depositories, stockbrokers, banks, and UPI app service provider companies. Initially, this service will be available to limited customers.

HDFC and ICICI Bank customers will get this service initially

NPCI said that this beta launch is being facilitated by the brokerage app 'Grow'. UPI app service will be available in the secondary market through BHIM, Grow and Yes Pay Next. Initially, customers of HDFC Bank and ICICI Bank will be able to use this service. Apart from this, HDFC Bank, HSBC, ICICI Bank and Yes Bank will act as clearing corporations and sponsor banks for the exchanges.

NPCI said that other stockbroker and UPI enabled apps including Zerodha, Axis Bank, Yes Bank, Paytm and PhonePe are currently in the certification stage and will soon join the beta phase.

Kunal Shah, founder of Indian fintech company CRED, said, 'The news of UPI's arrival in the secondary market is a big moment for India. This step will increase the speed of money and will help in same day settlement for stock exchanges of India. This is the first step of its kind in the world.

National Payments Corporation of India (NPCI) was established in 2008 to operate retail payments and settlement systems in India. NPCI has established a strong payment and settlement infrastructure in the country. NPCI has changed the way of retail payments through RuPay Card, Immediate Payment Service (IMPS) and Unified Payment Interface (UPI).