Named after the architect of our Indian Constitution Dr. B.R Ambedkar, BHIM is a mobile payment app based on UPI or Unified Payment Interface.
BHIM was a scheme designed by the government under the grand Digital India movement. It was made to make transactions, payments & ultimately business easier.
By now, you must have heard about BHIM, but as promised, that in this series, we will be discussing all the popular schemes by the government under Digital India. In case you haven’t read our earlier blogs, it will be linked below.
Now, let’s start with the basics.
What is BHIM?
BHIM is a UPI digital payments solution app developed by the National Payments Corporation of India (NPCI), the head organization for all retail payment systems in India.
With the help of this app, you can easily make direct bank-to-bank payments instantly, and collect money using just a mobile number or payment address. It allows person-to-person money transfers, scheduled money collection, and transactions to be done through a smartphone.
What does BHIM app do?
One of the greatest benefits of BHIM app is that the UPI transactions are combined to a single app, which means you don’t need to download multiple UPI-linked banking apps to make transactions.
Apart from the basic transactions, you can also check their account balance and switch between accounts in case you have 2 or 3 bank accounts.
There’s also the option of creating your own QR (Quick Response) code for a fixed amount of money, which the merchant can scan to make the deduction.
Now, you may ask, what exactly is the connection between BHIM & UPI?
What is UPI & how it is used?
UPI is a payment system that facilitates instant fund transfer between two bank accounts on a mobile platform, without requiring any detail of the beneficiary’s bank account.
When BHIM was launched in 2016, UPI was making major breakthroughs in the industry.
Now, nearly all the money transactions on apps like Paytm, PhonePe, BHIM are done through UPI. According to reports, more than 3 billion transactions took place on the UPI platform in 2018, and 620 million transactions were made in December 2018 alone!
UPI has emerged as the second most common method of digital payment in India.
NPCI has confirmed that by 2023, there will be 60 billion UPI transactions annually, accounting for more than 50 percent of India’s digital payments transactions.
How does BHIM work?
Let’s say you are an account holder at ICICI bank.
Now, the BHIM app has many options for various banks it has tie-ups with. It will let you choose your preferred bank after it has verified your mobile number. You get an SMS, so it’s best to use the same number as the one that’s linked to the bank account.
After this, you need to set a 4-digit code or pin just as you would set your ATM pin code. Remember to pick something you won’t forget easily because you’ll need the code every time you open the app.
After the selection of your bank is complete, if your UPI is activated, you can start your transactions!
BHIM supports numerous banks including Andhra Bank, Axis Bank, Bank of Baroda, Bank of Maharashtra, Canara Bank, Catholic Syrian Bank, Central Bank of India, DCB Bank, Dena Bank, Federal Bank, HDFC Bank, ICICI Bank, IDBI Bank, IDFC Bank, Indian Bank, Indian Overseas Bank, IndusInd Bank, Karnataka Bank, Karur Vysya Bank, Kotak Mahindra Bank, Union Bank of India, United Bank of India & others. The list goes on!
What are some of the benefits on BHIM?
Apart from being a unique payment transaction system, there are benefits of using BHIM which makes it a little different.
- BHIM has options to transfer via IFSC and MMID as well for non-UPI banks.
- Language- the app currently supports 16 languages & in the near future it is expected to run in 22 languages.
- There are no fees for transactions from Rs. 1 to Rs. 10,000.
- Transactions on BHIM are nearly instantaneous and can be done 24/7 including weekends and bank holidays.
What was BHIM contribution to UPI’s popularity?
As I said earlier, BHIM was launched when UPI was trying to have a breakthrough in the market.
BHIM created a repel effect for UPI. Within 15 months, transactions on UPI— among India’s latest digital payment platforms— raced to 105 million in November from 92,000 in August 2016.
One company made use of UPI at its best which is Tez which is now Google Pay.
What are some of the drawbacks of BHIM?
Although the timing was perfect, BHIM couldn’t be as popular as apps like Google Pay, PhonePe, Paytm and Mobikwik.
Tez, now Google Pay, took the benefit of UPI the most. The app offered lots of incentives to win customers, digital scratch cards for inviting others to join and transact on it, for sending and receiving money, for paying to the few merchants it has on the platform. It was like a lottery.
Also, some apps enabled other features like PhonePe offers payment of credit card bills or buying of gold through UPI.
Nonetheless, it is undeniable that BHIM has opened up a new forum in creating India a completely self-sufficient digital ecosystem. Big brands like Amazon are using BHIM UPI for its Amazon Pay.
So there is a big hope for BHIM!
Given that BHIM targets first-time digital payment users, the simplicity of the design is its stand-out feature. It does what it aims to do – keeping things simple.
Want to create your own app? Contact us at Skyram Technologies.
Our experts will guide you towards creating the most user-friendly app for your business!
And for our previous blogs on Digital India, read here!
