UPI

UPI (Unified Payments Interface) is a realtime payment system that lets customers in India link multiple bank accounts to a single app for instant digital payments.

It's the main way to pay online in India, processing the majority of transactions in the country. You can accept UPI for one-time purchases and subscriptions, with payments processed in INR.

You don't need to set up a bank account in India or sign up for a UPI merchant account to add UPI as a payment option with Paddle.

How it works

Customer chooses UPI

Turn on UPI in a couple of clicks in your Paddle dashboard. Paddle automatically presents UPI as a payment method for customers paying in India in INR, on desktop and mobile.

Customer starts confirmation

On desktop, customers scan a QR code with their phone.

On mobile, customers choose their preferred UPI app to complete the payment.

Customer confirms purchase

Customer confirms the purchase on their phone using their UPI app. The exact process varies, but typically they'll authenticate using their PIN or on-device biometrics.

If the customer is paying for a subscription, they'll also set up a UPI Autopay e-mandate where they consent to recurring payments.

Payment authorized

Payment is authorized, and Paddle Checkout shows a screen that confirms the checkout is completed, but the payment is pending capture.

Payment completed

After authorization, payment is captured. This typically happens immediately, but can take up to ten minutes.

The transaction is marked as completed in Paddle, and the customer receives a copy of their invoice by email.

UPI e-mandate rules mean subscription renewals take at least 24 hours to complete.

Things to know

Recurring payments using UPI are processed using UPI Autopay, a system run by the National Payments Corporation of India (NPCI) that lets customers set up an e-mandate to authorize recurring payments.

NPCI put restrictions on how UPI Autopay can be used, which means there are some limitations on how you can use UPI for subscriptions.

Mid-cycle changes to a subscription

A UPI e-mandate authorizes a specific amount, which Paddle calculates from the non-discounted recurring amount. Once an e-mandate is in place, Paddle can't charge more than this amount, and it can't make immediate, unscheduled charges against the mandate. This impacts how mid-cycle changes to a subscription work, including:

• Plan upgrades and downgrades
• Quantity changes
• Adding or removing a product
• Adding or removing a discount

When you make one of these changes, you should use a next billing period proration billing mode. For example, prorated_next_billing_period or full_next_billing_period. This applies the change at the next renewal instead of charging immediately.

What happens next depends on whether the change increases or decreases the recurring amount:

• Decreasing the amount, like a downgrade, works automatically. The new amount is lower than the existing mandate, so the next renewal collects the lower amount and the customer doesn't need to do anything.
• Increasing the amount, like an upgrade, needs a new mandate. The new amount is more than the existing mandate, so the next renewal fails and the subscription becomes past_due. The customer can update their payment method to authorize a new mandate for the new amount. If you use Paddle Retain, payment recovery prompts the customer and recovers the payment for you.

One-off charges against a subscription aren't supported

UPI e-mandates don't support one-off charges. This means billing a one-time charge against a subscription that's paid using UPI returns a payment_declined error.

To charge a customer a one-off amount, create a transaction for it and pass it to a checkout. This isn't linked to their existing subscription.

Renewal payments can take at least 24 hours

The initial payment is made while the customer is present at checkout, so it's completed quickly. It's typically captured immediately, but within ten minutes.

Subscription renewals work differently because the customer isn't present. At renewal, the customer receives a pre-debit notification, then banks must wait at least 24 hours from this notification before they attempt to collect payment. This is a requirement of NPCI regulations.