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Comment by abvdasker | Hacker News Reader

Having done a UPI integration for a well-known multinational tech company, I consider it a mixed bag. For the end-user it's a great concept and continues to revolutionize payments in India. It's convenient and it will help India transition away from a cash economy. UPI is clearly the future.

However, UPI currently has a lot of problems. Number one is that to use UPI as a payment method for your product you have to integrate with one of India's banks, which in my experience are almost uniformly technically very bad. They provide almost no documentation, have frequent and often severe service outages, and don't even come close to meeting their availability SLAs. I'm sure over time it will improve but as it stands many of India's banks are not technically capable enough to support UPI with the level of reliability that most businesses require.

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> have to integrate with one of India's banks

what you mention as a disadvantage is the biggest advantage. cut out the card men.

Banks' technical prowess will catch up. That is the solution. Not introducing a middle man just because he is technically better now.

Which is the same idea as SEPA-ICT or the German girocard system.

Cut out the middle men, the card companies, and suddenly everything is 2-3% cheaper, and faster, and simpler.

Cut out the middle men, the banks, use Bitcoin and you'll shave even the rest of the fees off.

There are middle men in bitcoin. In fact, there are a million middle men. But you trust those million men, rather than the 10 who run the bank.

Anyways, it's about how much money you're willing to spend for trust/safety/risk-mitigation/speed.

Cost of item - $100

$100.05 - pay via Bitcoin. In case of fraud, suck it up.

$102 - pay via Bank. In case of fraud, complain to bank, who are slow to resolve it.

$105 - pay via CC, (and pay them via Bank). In case of fraud, complain to CC company, who are faster in resolving it.

Both Bank and CC are basically an escrow service. One provides a bit more security than other, and correspondingly charges more for it.

If you're OK with not needing that security, cut out the middle men.

Going along your analogy lines, cut out even the Bitcoin middle man, or any kind of currency, and directly barter/trade goods.

Actually, let’s compare real cost and duration.

Cost of item: $100

SEPA: $100.00 (<15 seconds, irreversible)

GiroCard: $100.13 (< 5 seconds, medium to reverse)

Bitcoin: $100.57 (< 20 min, irreversible)

Bitcoin (SegWit): $100.41 (< 20min, irreversible)

MasterCard/VISA: $102.50 (< 30 days, easy to reverse)

Maybe my numbers are wrong. But my point was to say that each system has its advantage/disadvantages

Anycase, I'm in favor of the bank-bank Indian UPI & German SEPA system.

Yes, there are middlemen in Bitcoin, but there are also ways around them, unlike in banking.

And yes, I definitely trust million of men who are constantly checking each other, rather than 10 bankers who found out that sticking together makes them more money.

That fraud argument is a double edged sword because I might be on the receiving side and falsely accused of fraud as any small business hit with chargebacks would confirm. When it's sent, it's sent, that's how it should be, no backsies. In the CC world you never know. Plus there are also escrows if you really need them, except unlike in banking world, Bitcoin escrow won't force you to eat a 30% haircut on your savings account when the bankers fuck up the whole economy while paying themselves big bonuses.

Bitcoin is actually more expensive than SEPA transfers or girocard payments, and slower to resolve (and just as impossible to reverse as SEPA transfers).

That doesn't match my experience. I've never paid 3 EUR for bitcoin transaction and it never took a day, but SEPA does.

Which bank is this? Since 2014, SEPA-ICT has been introduced, and since this year, every bank should support it.

Normal SEPA transfers are mandated to be free and < 24 hours, and SEPA-ICT transfers are mandated to be < 1.5€ and < 15 seconds, but most banks implement those for free.

As you can freely choose any bank in the EU, you might want to consider German Commerzbank, which implements free < 15 seconds transfers to any other SEPA bank (except for student accounts, those have to pay 1.50€ for those transactions).

Why isn't there a central bank provider for this? Now every bank has to implement their own.

There is a central provider called NPCI (National Payments Corporation of India). They run the entire network and control who gets on or not. Banks are used as the integration point because UPI necessitated a bank account to run out of. Since you’re directly debiting money out of someone’s account you can’t exactly turn away the bank and when they are on-board it makes sense to use them as an integration partner for legal reasons (as well as customer support).

The merchant's bank account should be just a parameter you plug into some account at NPCI, and that's it.

Sure, the banks should do the chargeback/fraud management, but the IT interface toward the merchants should be completely standardized.

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