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UPI has no dispute resolution (as of now). So if you pay with UPI to someone and have a dispute, good luck. You have to approach the Indian courts to get your m

UPI has no dispute resolution (as of now). So if you pay with UPI to someone and have a dispute, good luck. You have to approach the Indian courts to get your money back, which, given the Indian justice system, is… difficult. By contrast, dispute resolution with cards is much easier. Also, I don’t recognise this 3% figure — not in all geographies. Eg Europe under PSD2 has 0.3% for credit cards, and 0.2% for debit cards. In Canada, Visa and MC recently agreed to a 1% cap. That said, I’d be very interested in seeing where the conversations around dispute resolution in UPI leads. Context: Indian banks have already begun to complain about UPI being free, and the Indian authorities had to quickly walk back a consultation around potential merchant-side charges to UPI. I guess this tension between business, customers, and digital intermediaries is what makes payments an interesting space.

vivegi 3y ago
> UPI has no dispute resolution (as of now) Not true. [1] [1]: https://www.npci.org.in/what-we-do/upi/dispute-redressal-mechanism https://www.npci.org.in/what-we-do/upi/dispute-redressal-mec...
- colesantiago 3y ago
  Glad to see it. It makes me sad that there are so many misconceptions about UPI that people are willing to resort to falsehoods (such as CBDCs and privacy) and it shows that most criticisms are from people that haven't used it in the real world.
  - 1024core 3y ago
    [flagged]
    - signal11 3y ago
      The UK’s Faster Payments system predates UPI. Free, near-instant payments round the clock. IMPS, the tech that powers UPI, came around 2 years later. But UPI as a layer on top of IMPS is great, especially the idea of providing an easy you@bank identifier. By contrast Faster Payments is like 102030-12345678. And being designed post iPhone was actually a blessing because it allowed UPI to have a mobile-first deployment strategy. But UPI also makes a virtue out of necessity: the reality that cards and a protected e-payment mechanism are difficult to organise, especially for India’s less-well off. This then turns into nationalistic chest thumping about “jealous foreigners”, while completely ignoring real issues around customer protection and scenarios that UPI doesn’t enable. To be clear: I wish UPI well. I also want to see less opportunities for scammers in UPI and for people to be able to use UPI with confidence knowing they will be easily refunded if things go wrong. It’s honestly tiresome to have reasoned conversations with nationalistic chest thumpers.
      - 1024core 3y ago
        > It’s honestly tiresome to have reasoned conversations with nationalistic chest thumpers. You are referring to yourself here, aren't you?
  - signal11 3y ago
    There are misconceptions about UPI all right, but a lot of it is from UPI proponents who have no idea what dispute resolution means. Order a bed and pay via UPI, say. Get a chair instead. These type of commercial disputes are difficult for a payments service to adjudicate. When you use the term “falsehoods”, keep in mind that a lot of these criticisms come from people who’ve worked in payments for decades, and know a fair bit about customer protection. If we’re going to talk about falsehoods, we should also talk about the falsehoods UPI proponents share about card payments. And to be clear, my focus is customer protection. I don’t give a flying fish about the mechanism.
- signal11 3y ago
  The process you link to is Indian bureaucracy at its finest. It also focuses on disputes surrounding UPI payments, ie “I paid via UPI and the money didn’t arrive”. Look at the categories of disputes on that page. The “fraudulent transaction” is extremely narrowly scoped to fraudulent use of your UPI account. But by “dispute resolution”, most people in payments mean commercial disputes — “I paid for a chicken, you sent me an egg” type disputes. Or didn’t send anything at all. That’s hard to deal with in UPI, last I checked. But I could be wrong! But then — why do all these UPI disputes and scams keep cropping up in newspapers and social media? Another scenario is dealing with a fraudulent withdrawal (no matter how it happens) by getting a refund with one phone call. The driver for this is that under most consumer-friendly legal systems, the customer gets a near-immediate refund for any unauthorised withdrawal. UPI => no. It’s damned difficult. To be clear, this isn’t a problem with UPI as a piece of code, UPI moves money from A to B cheaply and quickly. Great. But the governance that is wrapped around it has serious consumer protection problems. The problems (eg dispute resolution) will be an interesting one to resolve. Despite the bold “not true <link>” parent comment, disputes in UPI are currently a headache. And part of the reason is the narrow scope NPCI can act in.
  - vivegi 3y ago
    I use UPI daily. 1. In scenarios where UPI is replacing a cash transaction e.g., purchasing fruits from a fruit vendor on the street (just did it a few hours ago), the transaction is immediate. Disputes are settled exactly as how it would be done with a cash transaction i.e., discuss and settle with the vendor in situ. India had a separate settlement mechanism called Cash-On-Delivery that was needed for companies like Amazon/FlipKart etc., to penetrate the ecommerce space before UPI came into being. Even Amazon does returns and refunds through their online/app-based customer service process. 2. In scenarios where UPI is replacing a credit card e.g., I order food through a food delivery app and an item is missing. The food delivery app provides a customer service option where they are able to resolve the issue (they could a. deliver the missing item at no charge, b. give me a cash coupon for the inconvenience that I can use on their app, c. refuse to resolve the issue). I haven't had a scenario where the service provider has refused to resolve the issue. 3. As far as fraud is concerned, a couple of months ago the local police visited our apartment complex for a brief meeting to educate people on frauds and safety. They focused on digital crimes and told us about the national helpline for cybercrime. [1] Residents can dial 1930 to reach the national cybercrime helpline to report crimes, including online frauds -- this also includes the QR code scams that you hear about in the media. They register the complaint and guide you with the process for recovering lost funds. I haven't done this myself, but what the officer explained is that based on the transaction details, the national cybercrime control center coordinates with the participating banks on both sides of the transaction to immediately freeze funds. You can also take the complaint number to the nearest police station and get an FIR (First Information Report) filed to get the fraudsters criminally prosecuted. 4. In scenarios involving a buyer-seller dispute, there is the consumer protection laws where the consumer can directly file suit against the provider in a consumer court. These are special courts (separate from the civil and criminal courts) and are very effective in protecting consumer rights. This works for all types of consumer disputes about service/product issues. This would be the last resort for protecting consumer rights even in cases where a credit card company declines to handle a consumer's complaint on technicalities and is not just for UPI. These courts are at the district level in all states. [2] People in the west and other developed countries have a lot more of their digital transactions occuring on credit/debit cards and are comparing that with UPI. While what UPI is doing overlaps with a lot of that, it also is more than that in enabling micropayments and p2p payments. So, that is of value for the average Indian resident. [1]: https://cybercrime.gov.in/Webform/Helpline.aspx https://cybercrime.gov.in/Webform/Helpline.aspx [2]: http://ncdrc.nic.in/districtlist.html http://ncdrc.nic.in/districtlist.html
1024core 3y ago
> UPI has no dispute resolution (as of now). And cash does??
- signal11 3y ago
  If UPI competed with cash, that’d be sort of fine. The problem is that UPI enthusiasts think it’s a perfect replacement for cards. It’s not. Even with cash, because you need physical presence, you can inspect the goods. Under many UPI scenarios, that doesn’t happen. So a “and cash does?” comment sounds like a clever zinger, but in reality cash and UPI have different threat models. Equally, UPI is a useful alternative to cash and cards. The real world isn’t black and white. It’s not like UPI has zero value. But it’s not like cash and cards has zero value either. Finally, one scenario where cash > UPI is: anytime there’s an internet shutdown. Of which India has an insane number.
  - colesantiago 3y ago
    You can use UPI offline: https://www.gadgetsnow.com/how-to/how-to-pay-online-using-upi-without-internet/articleshow/85901176.cms https://www.gadgetsnow.com/how-to/how-to-pay-online-using-up... This is what I mean with so many misconceptions, falsehoods and just outright conspiracy theories, from people who have probably never used UPI.
    - signal11 3y ago
      > you can use UPI offline Yes, UPI Lite (local offline wallet) has a transaction limit of INR 200. Yes, 200. With a limit of 4000 per day and the Lite wallet can hold 2000 at any one time. Good luck doing anything serious with that. Also, good luck reloading the wallet when the internet is blocked. Note: the context of this thread was a UPI vs Cash comparison. Cash is king when the internet isn’t available. UPI Lite notwithstanding. And for those unfamiliar with Indian context: internet shutdowns happen at the drop of an hat, at a city or sometimes state/part of a state level. For days or longer. In one notorious instance, for multiple months. There’s little oversight, any local authority can make it happen, with little recourse by the public. They are a massive failure of local governance in India. And getting defensive about it won’t help you in the long run, if you live in India. Sooner or later, you’ll be affected too.
hocuspocus 3y ago
The EEA cap on fees only applies to interchange in 4-party schemes, i.e. the part that goes back to the issuing bank. PSPs typically charge between 0.7 and 1.5%. But yes, it's possible to do much better than countries like the US. For starters because card-present fraud is virtually nonexistent, and online fraud is drastically lower thanks to SCA. That said, you're right, there's a fundamental difference between moving funds in an immutable way (whose marginal price tends to zero) and a payment system.
toomuchtodo 3y ago
Which means bifurcation will occur. Payments where you have high trust and confidence you won’t need a dispute will use UPI or similar instant payment rails. Transactions where you are not confident or are concerned a dispute is going to be required, you’ll pay the transaction fee to use CC rails. Credit cards will become “insured payment” rails for lower trust transactions. I’d never dispute a payment to my mortgage servicer or electrical utility, but I absolutely might for a rando Facebook ad sale.
- signal11 3y ago
  > I’d never dispute a payment to my mortgage servicer or electrical utility, Er. “Never” is a strong word and it depends on scope. There have been numerous cases of overcharging. Sure, I might not dispute the payment itself, but the amount? Frequency? These get disputed all the time. Many jurisdictions have good consumer protections for this, though, so overcharging will cause penalties— that does provide incentives for companies to do the right thing.
deleted 3y ago
[deleted]

vivegi 3y ago

> UPI has no dispute resolution (as of now) Not true. [1] [1]: https://www.npci.org.in/what-we-do/upi/dispute-redressal-mechanism https://www.npci.org.in/what-we-do/upi/dispute-redressal-mec...

colesantiago 3y ago
Glad to see it. It makes me sad that there are so many misconceptions about UPI that people are willing to resort to falsehoods (such as CBDCs and privacy) and it shows that most criticisms are from people that haven't used it in the real world.
- 1024core 3y ago
  [flagged]
  - signal11 3y ago
    The UK’s Faster Payments system predates UPI. Free, near-instant payments round the clock. IMPS, the tech that powers UPI, came around 2 years later. But UPI as a layer on top of IMPS is great, especially the idea of providing an easy you@bank identifier. By contrast Faster Payments is like 102030-12345678. And being designed post iPhone was actually a blessing because it allowed UPI to have a mobile-first deployment strategy. But UPI also makes a virtue out of necessity: the reality that cards and a protected e-payment mechanism are difficult to organise, especially for India’s less-well off. This then turns into nationalistic chest thumping about “jealous foreigners”, while completely ignoring real issues around customer protection and scenarios that UPI doesn’t enable. To be clear: I wish UPI well. I also want to see less opportunities for scammers in UPI and for people to be able to use UPI with confidence knowing they will be easily refunded if things go wrong. It’s honestly tiresome to have reasoned conversations with nationalistic chest thumpers.
    - 1024core 3y ago
      > It’s honestly tiresome to have reasoned conversations with nationalistic chest thumpers. You are referring to yourself here, aren't you?
- signal11 3y ago
  There are misconceptions about UPI all right, but a lot of it is from UPI proponents who have no idea what dispute resolution means. Order a bed and pay via UPI, say. Get a chair instead. These type of commercial disputes are difficult for a payments service to adjudicate. When you use the term “falsehoods”, keep in mind that a lot of these criticisms come from people who’ve worked in payments for decades, and know a fair bit about customer protection. If we’re going to talk about falsehoods, we should also talk about the falsehoods UPI proponents share about card payments. And to be clear, my focus is customer protection. I don’t give a flying fish about the mechanism.
signal11 3y ago
The process you link to is Indian bureaucracy at its finest. It also focuses on disputes surrounding UPI payments, ie “I paid via UPI and the money didn’t arrive”. Look at the categories of disputes on that page. The “fraudulent transaction” is extremely narrowly scoped to fraudulent use of your UPI account. But by “dispute resolution”, most people in payments mean commercial disputes — “I paid for a chicken, you sent me an egg” type disputes. Or didn’t send anything at all. That’s hard to deal with in UPI, last I checked. But I could be wrong! But then — why do all these UPI disputes and scams keep cropping up in newspapers and social media? Another scenario is dealing with a fraudulent withdrawal (no matter how it happens) by getting a refund with one phone call. The driver for this is that under most consumer-friendly legal systems, the customer gets a near-immediate refund for any unauthorised withdrawal. UPI => no. It’s damned difficult. To be clear, this isn’t a problem with UPI as a piece of code, UPI moves money from A to B cheaply and quickly. Great. But the governance that is wrapped around it has serious consumer protection problems. The problems (eg dispute resolution) will be an interesting one to resolve. Despite the bold “not true <link>” parent comment, disputes in UPI are currently a headache. And part of the reason is the narrow scope NPCI can act in.
- vivegi 3y ago
  I use UPI daily. 1. In scenarios where UPI is replacing a cash transaction e.g., purchasing fruits from a fruit vendor on the street (just did it a few hours ago), the transaction is immediate. Disputes are settled exactly as how it would be done with a cash transaction i.e., discuss and settle with the vendor in situ. India had a separate settlement mechanism called Cash-On-Delivery that was needed for companies like Amazon/FlipKart etc., to penetrate the ecommerce space before UPI came into being. Even Amazon does returns and refunds through their online/app-based customer service process. 2. In scenarios where UPI is replacing a credit card e.g., I order food through a food delivery app and an item is missing. The food delivery app provides a customer service option where they are able to resolve the issue (they could a. deliver the missing item at no charge, b. give me a cash coupon for the inconvenience that I can use on their app, c. refuse to resolve the issue). I haven't had a scenario where the service provider has refused to resolve the issue. 3. As far as fraud is concerned, a couple of months ago the local police visited our apartment complex for a brief meeting to educate people on frauds and safety. They focused on digital crimes and told us about the national helpline for cybercrime. [1] Residents can dial 1930 to reach the national cybercrime helpline to report crimes, including online frauds -- this also includes the QR code scams that you hear about in the media. They register the complaint and guide you with the process for recovering lost funds. I haven't done this myself, but what the officer explained is that based on the transaction details, the national cybercrime control center coordinates with the participating banks on both sides of the transaction to immediately freeze funds. You can also take the complaint number to the nearest police station and get an FIR (First Information Report) filed to get the fraudsters criminally prosecuted. 4. In scenarios involving a buyer-seller dispute, there is the consumer protection laws where the consumer can directly file suit against the provider in a consumer court. These are special courts (separate from the civil and criminal courts) and are very effective in protecting consumer rights. This works for all types of consumer disputes about service/product issues. This would be the last resort for protecting consumer rights even in cases where a credit card company declines to handle a consumer's complaint on technicalities and is not just for UPI. These courts are at the district level in all states. [2] People in the west and other developed countries have a lot more of their digital transactions occuring on credit/debit cards and are comparing that with UPI. While what UPI is doing overlaps with a lot of that, it also is more than that in enabling micropayments and p2p payments. So, that is of value for the average Indian resident. [1]: https://cybercrime.gov.in/Webform/Helpline.aspx https://cybercrime.gov.in/Webform/Helpline.aspx [2]: http://ncdrc.nic.in/districtlist.html http://ncdrc.nic.in/districtlist.html

1024core 3y ago

> UPI has no dispute resolution (as of now). And cash does??

signal11 3y ago
If UPI competed with cash, that’d be sort of fine. The problem is that UPI enthusiasts think it’s a perfect replacement for cards. It’s not. Even with cash, because you need physical presence, you can inspect the goods. Under many UPI scenarios, that doesn’t happen. So a “and cash does?” comment sounds like a clever zinger, but in reality cash and UPI have different threat models. Equally, UPI is a useful alternative to cash and cards. The real world isn’t black and white. It’s not like UPI has zero value. But it’s not like cash and cards has zero value either. Finally, one scenario where cash > UPI is: anytime there’s an internet shutdown. Of which India has an insane number.
- colesantiago 3y ago
  You can use UPI offline: https://www.gadgetsnow.com/how-to/how-to-pay-online-using-upi-without-internet/articleshow/85901176.cms https://www.gadgetsnow.com/how-to/how-to-pay-online-using-up... This is what I mean with so many misconceptions, falsehoods and just outright conspiracy theories, from people who have probably never used UPI.
  - signal11 3y ago
    > you can use UPI offline Yes, UPI Lite (local offline wallet) has a transaction limit of INR 200. Yes, 200. With a limit of 4000 per day and the Lite wallet can hold 2000 at any one time. Good luck doing anything serious with that. Also, good luck reloading the wallet when the internet is blocked. Note: the context of this thread was a UPI vs Cash comparison. Cash is king when the internet isn’t available. UPI Lite notwithstanding. And for those unfamiliar with Indian context: internet shutdowns happen at the drop of an hat, at a city or sometimes state/part of a state level. For days or longer. In one notorious instance, for multiple months. There’s little oversight, any local authority can make it happen, with little recourse by the public. They are a massive failure of local governance in India. And getting defensive about it won’t help you in the long run, if you live in India. Sooner or later, you’ll be affected too.

hocuspocus 3y ago

The EEA cap on fees only applies to interchange in 4-party schemes, i.e. the part that goes back to the issuing bank. PSPs typically charge between 0.7 and 1.5%. But yes, it's possible to do much better than countries like the US. For starters because card-present fraud is virtually nonexistent, and online fraud is drastically lower thanks to SCA. That said, you're right, there's a fundamental difference between moving funds in an immutable way (whose marginal price tends to zero) and a payment system.

toomuchtodo 3y ago

Which means bifurcation will occur. Payments where you have high trust and confidence you won’t need a dispute will use UPI or similar instant payment rails. Transactions where you are not confident or are concerned a dispute is going to be required, you’ll pay the transaction fee to use CC rails. Credit cards will become “insured payment” rails for lower trust transactions. I’d never dispute a payment to my mortgage servicer or electrical utility, but I absolutely might for a rando Facebook ad sale.

signal11 3y ago
> I’d never dispute a payment to my mortgage servicer or electrical utility, Er. “Never” is a strong word and it depends on scope. There have been numerous cases of overcharging. Sure, I might not dispute the payment itself, but the amount? Frequency? These get disputed all the time. Many jurisdictions have good consumer protections for this, though, so overcharging will cause penalties— that does provide incentives for companies to do the right thing.

deleted 3y ago

[deleted]