Razorpay has introduced its Turbo UPI along with Axis Bank and the National Payments Council of India (NPCI). Turbo UPI facilitates UPI payments to be faster and reduce potential payment failures.

Turbo UPI can be integrated at the payment gateway by the merchants, which eliminates the need for customers to go to third-party UPI payment apps. This will allow customers to pay directly from their UPI-linked bank accounts within the merchant app. The additional step of switching apps is estimated to cause almost 5-10 percent of payment failures.

“This is a one-click process and the payment​ is​ completed much faster. Here no PSPs (payment service providers) are required, the merchant app will itself become a UPI App. The merchant will install a Razorpay Plug-in and the customer can directly link their bank accounts to the merchant app,” ​said Shashank Kumar, cofounder and Managing Director of Razorpay, in an interaction with a news portal.

The additional steps involved in using a third-party app like Google Pay or PhonePe can make the payment process cumbersome. Sometimes, messages or notifications for the payment prompt may be delayed, which could result in customers missing the payments. This is one of the reasons why some large digital merchants prefer to build their own UPI payment solutions. For example, Amazon has Amazon Pay UPI, while Zomato recently launched Zomato UPI. Flipkart also has plans to start its own UPI payments solution.

Razorpay claims that with the help of Turbo UPI business can have a significant increase in the success rate of UPI payments by up to 10 percent. Also, Turbo UPI provides insights to merchants regarding the end-user drop-off pattern, while enabling merchants to control the end-to-end payment experience of their customers.

While Turbo UPI is still in the pilot stage, Razorpay said that customers of popular apps including Tata StarQuik, Ixigo, FNP (Ferns N Petals), Trainman, and Dhan are among several companies that will soon enable this product on their platforms. Razorpay expects more than a thousand of its merchants to enable this facility over the next couple of years.

“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​," Kumar added.​ Around 56% of Razorpay's digital payments are done through UPI, indicating the importance of this feature for its merchant partners.

While making a payment for a purchase, for example, on Swiggy or Zomato (Merchant app), if customers choose UPI then it involves transitioning from the Merchant App to a payment app (such as Google Pay or PhonePe, etc.). The customer selects the linked bank account and enters the secure UPI PIN.

The page then redirects back to the merchant app, and a notification is sent to the customer to inform them that the payment has been completed. Currently, this is the standard process and there are chances of payment failures due to network issues, drop-off problems, and more.

But with faster UPI payment solutions, the entire process becomes simple with just one click while reducing the failure rates. Here the customer’s bank account is linked with the merchant app. The customer only needs to enter the UPI PIN while staying within the merchant's app, and the payment is completed.

“The whole thing comes down to a 30-second process. We had been working with NPCI on how to improve this and now we have Turbo UPI…This improves the success rate of payments by at least 10 percent,” said Kumar. ​He​ added that this solution helps merchants to collect data on where the payment stops and helps in servicing a customer better​ next time. “There is better analytics and better visibility of the lifecycle of the customer,​" he said.​

Razorpay also expects that this move will increase the opportunities and cross-selling choices.