Virtual UPI IDs are like any other UPI VPA (Virtual payment address) that a user defines at the time of registration on a UPI app. Using Cashfree API, businesses can generate these UPI IDs in bulk against each customer or invoice. When the payment is received on these IDs, businesses know exactly who paid and for what.
Business’s own accounting software can be hooked to Cashfree’s system for automated updates on incoming payments. Thereby, removing the time taking the process of manual reconciliation and delay in payment acknowledgment.
A classic example can be a share brokerage firm receiving deposits from clients for purchase of securities. In such a case, the share broker can generate a unique UPI ID for each client and share the ID with them. When payment is received, the service provider gets notified and payment is mapped against the client.
Cashfree had earlier launched AutoCollect, its reconciliation solution, where a business could generate any number of virtual bank accounts and match inbound NEFT & IMPS transfers. With the addition of virtual UPI IDs, Cashfree is making UPI payments through Google Pay, Whatsapp, Phone Pe and other Apps easy to be reconciled for businesses.
Akash Sinha, the co-founder of Cashfree, said, "In the last 2 years, 3 million virtual bank accounts have been generated using Cashfree AutoCollect. With the growth of UPI as a preferred way to pay, we believe it is the right time to enable AutoCollect for UPI, along with NEFT/IMPS/RTGS and cheque payments. Until now, UPI has been used mostly for small ticket size transactions. With the provision of automated reconciliation through virtual UPI IDs, a growing number of businesses will start to offer UPI payment option."
Leading online platforms including EarlySalary, Milaap and Ketto are some already using virtual accounts for easy collection and reconciliation.
