What is the purpose of UPI ID?

A UPI ID is a Virtual Payment Address (VPA) that serves as a unique identifier for a user within the Unified Payments Interface (UPI) system. Its primary purpose is to facilitate instant, digital money transfers. It links to a user's bank account, allowing them to send and receive funds using only the ID, eliminating the need to share sensitive details like bank account numbers or IFSC codes. This unique address helps banks track a user's account for UPI services.