Payments Academy
UPI mandate PAYMENT OPERATIONS STARTED LIVE 01 UPI mandate - standing instruction registered on the UPI ACTIVE 02 UPI mandate flows - collect flow and the pay flow are two QUEUED 03 Collection notifications - requirements should state the notification QUEUED 04 BA - pending mandate request QUEUED 05 Streaming subscription - real example is a streaming subscription QUEUED 06 BA - confirmation message QUEUED A UPI mandate is a standing instruction registered on the UPI platform that authorises a merchant to collect payments from a customer bank account through UPI Step 1 of 6 UPI mandate STARTED UPI mandate standing instruction registered on the UPI ACTIVE UPI mandate flows collect flow and the pay flow are two QUEUED Collection notifications requirements should state the notification QUEUED BA pending mandate request QUEUED Streaming subscription real example is a streaming subscription QUEUED BA confirmation message QUEUED A UPI mandate is a standing instruction registered on the UPI platform that authorises a merchant to collect payments from a customer bank account through UPI
UPI mandate flows PAYMENT OPERATIONS IN PROGRESS LIVE 01 UPI mandate - standing instruction registered on the UPI DONE 02 UPI mandate flows - collect flow and the pay flow are two ACTIVE 03 Collection notifications - requirements should state the notification QUEUED 04 BA - pending mandate request QUEUED 05 Streaming subscription - real example is a streaming subscription QUEUED 06 BA - confirmation message QUEUED The collect flow and the pay flow are two different ways a UPI mandate can be used, and the BA must not confuse them. Step 2 of 6 UPI mandate flows IN PROGRESS UPI mandate standing instruction registered on the UPI DONE UPI mandate flows collect flow and the pay flow are two ACTIVE Collection notifications requirements should state the notification QUEUED BA pending mandate request QUEUED Streaming subscription real example is a streaming subscription QUEUED BA confirmation message QUEUED The collect flow and the pay flow are two different ways a UPI mandate can be used, and the BA must not confuse them.
Collection notifications PAYMENT OPERATIONS IN PROGRESS LIVE 01 UPI mandate - standing instruction registered on the UPI DONE 02 UPI mandate flows - collect flow and the pay flow are two DONE 03 Collection notifications - requirements should state the notification ACTIVE 04 BA - pending mandate request QUEUED 05 Streaming subscription - real example is a streaming subscription QUEUED 06 BA - confirmation message QUEUED The requirements should state the notification that the customer receives before and after each collection. Step 3 of 6 Collection notifications IN PROGRESS UPI mandate standing instruction registered on the UPI DONE UPI mandate flows collect flow and the pay flow are two DONE Collection notifications requirements should state the notification ACTIVE BA pending mandate request QUEUED Streaming subscription real example is a streaming subscription QUEUED BA confirmation message QUEUED The requirements should state the notification that the customer receives before and after each collection.
BA should specify the expiry time PAYMENT OPERATIONS IN PROGRESS LIVE 01 UPI mandate - standing instruction registered on the UPI DONE 02 UPI mandate flows - collect flow and the pay flow are two DONE 03 Collection notifications - requirements should state the notification DONE 04 BA - pending mandate request ACTIVE 05 Streaming subscription - real example is a streaming subscription QUEUED 06 BA - confirmation message QUEUED The BA should specify the expiry time for a pending mandate request, typically 24 hours, and the customer message when a mandate request is received from an unknown merchant. Step 4 of 6 BA should specify the expiry time IN PROGRESS UPI mandate standing instruction registered on the UPI DONE UPI mandate flows collect flow and the pay flow are two DONE Collection notifications requirements should state the notification DONE BA pending mandate request ACTIVE Streaming subscription real example is a streaming subscription QUEUED BA confirmation message QUEUED The BA should specify the expiry time for a pending mandate request, typically 24 hours, and the customer message when a mandate request is received from an unknown merchant.
Streaming subscription: Rs 649/month PAYMENT OPERATIONS IN PROGRESS LIVE 01 UPI mandate - standing instruction registered on the UPI DONE 02 UPI mandate flows - collect flow and the pay flow are two DONE 03 Collection notifications - requirements should state the notification DONE 04 BA - pending mandate request DONE 05 Streaming subscription - real example is a streaming subscription ACTIVE 06 BA - confirmation message QUEUED A real example is a streaming subscription of 649 rupees per month. Step 5 of 6 Streaming subscription: Rs 649/month IN PROGRESS UPI mandate standing instruction registered on the UPI DONE UPI mandate flows collect flow and the pay flow are two DONE Collection notifications requirements should state the notification DONE BA pending mandate request DONE Streaming subscription real example is a streaming subscription ACTIVE BA confirmation message QUEUED A real example is a streaming subscription of 649 rupees per month.
BA must specify the revocation flow PAYMENT OPERATIONS COMPLETE LIVE 01 UPI mandate - standing instruction registered on the UPI DONE 02 UPI mandate flows - collect flow and the pay flow are two DONE 03 Collection notifications - requirements should state the notification DONE 04 BA - pending mandate request DONE 05 Streaming subscription - real example is a streaming subscription DONE 06 BA - confirmation message ACTIVE The BA must specify the revocation flow, the confirmation message, the merchant notification, and the handling of a collection that was already in flight when the revocation happened. Step 6 of 6 BA must specify the revocation flow COMPLETE UPI mandate standing instruction registered on the UPI DONE UPI mandate flows collect flow and the pay flow are two DONE Collection notifications requirements should state the notification DONE BA pending mandate request DONE Streaming subscription real example is a streaming subscription DONE BA confirmation message ACTIVE The BA must specify the revocation flow, the confirmation message, the merchant notification, and the handling of a collection that was already in flight when the revocation happened.

Key points of this lesson, in order.

0:00 / 4:07 Step 1 of 6

UPI Mandate and Autopay: Requirements from a BA Perspective

Indian Payments Deep Dive: NACH, BBPS, FEMA, Lesson 4 of 9, Narration 4:07, D05 Domestic payment systems

MandateCaptureRetry

What you will learn

Your objective. By the end of this lesson, you will be able to explain UPI mandate and autopay: requirements from a BA perspective. A UPI mandate is a standing instruction registered on the UPI platform that authorises a merchant to collect payments from a customer bank account through UPI, up to a defined maximum amount and within a defined period.

Why it matters. This matters because the rail decides how fast the money moves, what it costs, when it settles and what can go wrong. Choosing the wrong rail is a product and an operations failure.

Chapter objective: Learner explains Indian payment systems in depth, including NACH, BBPS, and FEMA rules, and applies them to recurring collections, bill payments, and cross-border transfers from India. Learner practises this skill on realistic banking cases, explaining the reasoning clearly and using correct terminology throughout the work.

Key learning points

  • UPI mandate
  • UPI mandate flows
  • Collection notifications
  • BA should specify the expiry time
  • Streaming subscription: Rs 649/month
  • BA must specify the revocation flow

Key terms

Mandate: An authorisation given by a debtor to a creditor to collect payments from the debtor account by direct debit.

Capture: The step in a card transaction where the merchant collects the authorised amount from the issuer, usually when goods are shipped.

Retry: Repeating a failed request or message delivery after a delay, usually with a limit on attempts and a back off period.

Payment flow diagram showing UPI Mandate and Autopay: Requirements from a BA Perspective.

Practise this lesson

Exercise

Decide which settlement model fits the scenario in this lesson and explain why.

Use the settlement models, the liquidity trade-off and the finality rules in this lesson.

  1. What to do. Name the model, state when settlement becomes final, and explain what happens if the sending bank does not have enough liquidity.

Correct result. Real time gross settlement settles each payment individually in central bank money with immediate finality, but it needs liquidity for every payment. Deferred net settlement nets payments and settles the net position, which needs less liquidity but leaves settlement risk until the net settles.

Why. Settlement is where money actually moves. The model decides the risk, the liquidity need, and when the payment is truly final.

Check your understanding

Practice question

Which of the following best describes UPI mandate and autopay: requirements from a BA perspective?

Takeaway and next step

What to remember

The test cases should include revocation before the first debit, revocation between debits, and a merchant presentation after revocation that must be rejected by the system.

Follow 5,000 rupees through every stage, from instruction to beneficiary credit, and note where it can stop.

Open the Payment Lifecycle Simulator →

Builds on "BBPS: How Bharat Bill Payment Works".

Transcript and full text

Show transcript

A UPI mandate is a standing instruction registered on the UPI platform that authorises a merchant to collect payments from a customer bank account through UPI, up to a defined maximum amount and within a defined period. The customer creates the mandate by approving it in the UPI app with a UPI PIN, and the mandate is stored by NPCI and linked to the customer bank account and the merchant. The merchant can then present collections against the mandate on the agreed dates, and the customer bank debits the account automatically, subject to the mandate limits. A BA must document the mandate fields, the merchant name, the maximum amount per debit, the frequency, the start date, the end date, the purpose, and the unique mandate reference that appears on the customer bank statement. The collect flow and the pay flow are two different ways a UPI mandate can be used, and the BA must not confuse them. In a collect flow the merchant initiates the collection, for example a mutual fund house collecting a monthly SIP of 5,000 rupees, and the customer does not need to act on the debit date. In a pay flow the customer initiates the payment, for example by tapping pay on a subscription renewal screen, and the mandate is used to authorise the payment without re-entering the full details. The system must record which flow was used for each transaction, because the dispute handling differs, a collect flow dispute is about whether the merchant was authorised to collect, while a pay flow dispute is about whether the customer intended that specific payment. The requirements should state the notification that the customer receives before and after each collection. Mandate creation is a multi step journey that must be designed with clear confirmations at each stage. The merchant sends a mandate request with the amount, frequency and validity, the customer receives it in the UPI app, reviews the details, and approves it by entering the UPI PIN. The UPI app sends the approval to the customer bank through the NPCI switch, the bank validates the account and registers the mandate, and the merchant receives a confirmation with the mandate reference. If the customer declines, the merchant must receive a clear rejection and must not retry the mandate request repeatedly. The BA should specify the expiry time for a pending mandate request, typically 24 hours, and the customer message when a mandate request is received from an unknown merchant. Mandate execution is the debit itself, and it must respect the limits that protect the customer. Each execution must check that the mandate is active, that the amount does not exceed the maximum, that the date is within the validity period, and that the total of all executions does not exceed any cumulative limit. If any check fails, the execution must be rejected before the account is debited, and the merchant must receive a reason code. For higher value mandates, the regulator requires an additional customer approval before execution, so the BA must capture the threshold for pre-debit notification and the timing, often 24 hours before the debit. A real example is a streaming subscription of 649 rupees per month. The customer receives a notification a day before the debit, and can cancel the mandate from the UPI app if the subscription is no longer wanted. Revocation is the customer right to cancel a mandate at any time, and it must work instantly from the UPI app and from the bank channel. When the customer revokes a mandate, the UPI system marks it as revoked, informs the merchant, and blocks any future execution, even if the merchant presents a collection on the same day. The merchant must stop presenting collections immediately and must inform the customer of any pending service impact, such as a subscription that will lapse. The BA must specify the revocation flow, the confirmation message, the merchant notification, and the handling of a collection that was already in flight when the revocation happened. The test cases should include revocation before the first debit, revocation between debits, and a merchant presentation after revocation that must be rejected by the system.

A UPI mandate is a standing instruction registered on the UPI platform that authorises a merchant to collect payments from a customer bank account through UPI, up to a defined maximum amount and within a defined period. The customer creates the mandate by approving it in the UPI app with a UPI PIN, and the mandate is stored by NPCI and linked to the customer bank account and the merchant. The merchant can then present collections against the mandate on the agreed dates, and the customer bank debits the account automatically, subject to the mandate limits. A BA must document the mandate fields, the merchant name, the maximum amount per debit, the frequency, the start date, the end date, the purpose, and the unique mandate reference that appears on the customer bank statement.

The collect flow and the pay flow are two different ways a UPI mandate can be used, and the BA must not confuse them. In a collect flow the merchant initiates the collection, for example a mutual fund house collecting a monthly SIP of 5,000 rupees, and the customer does not need to act on the debit date. In a pay flow the customer initiates the payment, for example by tapping pay on a subscription renewal screen, and the mandate is used to authorise the payment without re-entering the full details. The system must record which flow was used for each transaction, because the dispute handling differs, a collect flow dispute is about whether the merchant was authorised to collect, while a pay flow dispute is about whether the customer intended that specific payment. The requirements should state the notification that the customer receives before and after each collection.

Mandate creation is a multi step journey that must be designed with clear confirmations at each stage. The merchant sends a mandate request with the amount, frequency and validity, the customer receives it in the UPI app, reviews the details, and approves it by entering the UPI PIN. The UPI app sends the approval to the customer bank through the NPCI switch, the bank validates the account and registers the mandate, and the merchant receives a confirmation with the mandate reference. If the customer declines, the merchant must receive a clear rejection and must not retry the mandate request repeatedly. The BA should specify the expiry time for a pending mandate request, typically 24 hours, and the customer message when a mandate request is received from an unknown merchant.

Mandate execution is the debit itself, and it must respect the limits that protect the customer. Each execution must check that the mandate is active, that the amount does not exceed the maximum, that the date is within the validity period, and that the total of all executions does not exceed any cumulative limit. If any check fails, the execution must be rejected before the account is debited, and the merchant must receive a reason code. For higher value mandates, the regulator requires an additional customer approval before execution, so the BA must capture the threshold for pre-debit notification and the timing, often 24 hours before the debit. A real example is a streaming subscription of 649 rupees per month. The customer receives a notification a day before the debit, and can cancel the mandate from the UPI app if the subscription is no longer wanted.

Revocation is the customer right to cancel a mandate at any time, and it must work instantly from the UPI app and from the bank channel. When the customer revokes a mandate, the UPI system marks it as revoked, informs the merchant, and blocks any future execution, even if the merchant presents a collection on the same day. The merchant must stop presenting collections immediately and must inform the customer of any pending service impact, such as a subscription that will lapse. The BA must specify the revocation flow, the confirmation message, the merchant notification, and the handling of a collection that was already in flight when the revocation happened. The test cases should include revocation before the first debit, revocation between debits, and a merchant presentation after revocation that must be rejected by the system.

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