Why in-app payments are a gamechanger for businesses —and how BharatPe makes them simple

In the rapidly evolving landscape of digital transactions, the Unified Payments Interface (UPI) has emerged as a transformative force, enabling fast, secure, and seamless payments. For online merchants, providing an in-app payment experience has become essential to retain customers and offer a frictionless journey. 

BharatPe, in collaboration with Unity Bank, has introduced an innovative Merchant Plugin that simplifies this process. By integrating in-app UPI payments directly into their applications, merchants can enhance customer experiences, ensure data security, and drive business growth without unnecessary complexities.

For any application facilitating purchases or services, payment integration is a key component. Without it, customers are often redirected to a few TPAPs, resulting in their monopoly in the UPI space to complete transactions. This redirection can lead to friction, delays, and potentially lost sales, along with sharing customers' digital footprints with TPAPs, who might also be competitors. 

As a result, merchants need to be cautious. Many merchants now seek in-app payment options to avoid disruptions and potential competitor exposure, striving to offer a smooth, reliable transaction experience that keeps users within their own ecosystem.

Understanding the evolution of in-app payment experiences

For merchants, offering an in-app payment experience has traditionally been complex. To achieve this, merchants were required to become a Third-Party Application Provider (TPAP) and then choose between two primary approaches for integration:

1. API-Based Integration (Multi-Bank Model): This approach required significant integration effort and complexity, as merchants had to collaborate with several banks' Payment Service Provider (PSP) servers. Additionally, this model involved increased compliance and regulatory overhead, making it more suitable for larger merchants with higher transaction volumes, as they could justify dedicating the necessary technical bandwidth.
2. Bank SDK Approach (Single Bank Model): Merchants opting for the single bank SDK approach benefited from a simpler integration process. This approach ensured strong data protection by facilitating direct communication between the app’s SDK and the bank’s PSP server.

Despite both options providing an in-app payment experience, they came with limitations. Merchants without ambitions to become payments apps found themselves obligated to enable all UPI PSP features in their applications, many of which may not align with their business goals. This resulted in unnecessary integration efforts, compliance challenges, and scalability issues.

Introducing UPI Plug-In: A simplified approach

Recognising the need for a streamlined solution, the National Payments Corporation of India (NPCI) introduced the UPI Plug-In service. This innovative model allows merchants to offer in-app payment experiences without becoming a TPAP, thereby reducing complexity and compliance burdens. By leveraging the sponsor bank’s PSP SDK, merchants can integrate the most relevant UPI features for their business with minimal effort.

Key advantages of UPI Plug-In for merchants

• Ease of integration: Merchants need to integrate only the most relevant features, enabling quick and efficient implementation.
• Reduced compliance requirements: Unlike TPAP arrangements, the UPI Plug-In model eliminates the need for multiple agreements and extensive regulatory obligations.
• Enhanced user experience: Customers complete transactions within the merchant’s app, reducing dropouts and improving success rates.
• Flexibility and scalability: Merchants retain the option to scale their UPI capabilities as their business grows, transitioning to TPAP functionality if needed.

BharatPe’s Merchant Plugin: Revolutionising payment acceptance

In collaboration with Unity Bank, BharatPe has developed a Merchant Plugin that leverages the UPI Plug-In model. This plugin empowers merchants to:

• Maintain customer engagement by avoiding redirections to third-party apps.
• Secure transaction data within their ecosystem, minimising exposure to competitors.
• Customise integration to align with their specific business objectives.

Through BharatPe’s Merchant Plugin, merchants can achieve seamless in-app payment experiences without the complexities associated with traditional TPAP or API-based approaches.

Timelines for implementation

• API-Based Integration (Multi-Bank Model): Typically requires six months to over a year, depending on the complexity and number of bank partnerships required.
• Bank SDK Approach (Single Bank Model): Achievable within three months, assuming the merchant’s tech team is adequately prepared.
• UPI Plug-In Integration: With sufficient bank support and technical readiness, integration can be completed within one month.

BharatPe’s Merchant Plugin represents a significant advancement in simplifying in-app payment integration for merchants. By adopting the UPI Plug-In model, merchants can provide a superior payment experience, retain control over transaction flows, and strengthen customer loyalty. This innovative solution underscores BharatPe’s commitment to empowering businesses with cutting-edge payment technologies, fostering growth, and enhancing the digital transaction ecosystem.

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)