Universal Payment Identification Code (UPIC) Transaction Volume Surpasses $1 Billion

A UPIC is a unique bank account identifier issued by financial institutions that allows organizations to receive electronic payments without divulging confidential banking information. Developed by the Electronic Payments Network (EPN), UPICs are for credit payments only and minimize the possibility of unauthorized debits, checks and demand drafts.

"2005 has been the year of the UPIC," said Rossana Salaris, Senior Vice President of The Clearing House, responsible for EPN. "The volume of UPIC payments grew significantly in 2005 as more than 20 companies were issued UPICs by their financial institutions. UPICs are gaining momentum because organizations increasingly recognize that they can reduce risk and facilitate cost-effective electronic payments. Given the success of the UPIC in 2005, we expect 2006 to be an equally important year for the adoption of the UPIC."

UPICs are currently used by public and private entities across the country, including nonprofit organizations such as colleges and universities, as well as a wide range of companies in the technology, telecommunications, medical technologies, real estate, and agriculture industries. In October 2005, The Electronic Payments Association-NACHA began using a UPIC to facilitate electronic business-to-business payments from its members.

UPICs are helping remove two of the key barriers identified in research from the Association of Financial Professionals -- the lack of accurate bank account data for vendors and the reluctance to give out bank account information. In addition, an EPN research study found that 38% of large corporations reported unauthorized debits within a six-month period.

How A UPIC Works

No system changes are needed to accounts payable, accounts receivable or cash management systems to use a UPIC. A UPIC looks and acts like a standard bank account number, and travels through the ACH network with the Universal Routing and Transit number. However, a UPIC can only be used for ACH credit payments. A UPIC cannot be used to electronically debit an organization's account or create a check or demand draft, thus reducing the risk of unauthorized debits. The UPIC can be printed on invoices, provided on matching gift forms and displayed on the Internet. Account information is kept private.

A UPIC becomes an organization's permanent electronic payment address. Portability of the UPIC reduces the effort required in changing accounts due to bank mergers or changes in banking relationships, including the cost of communicating new bank account information to trading partners.

To find out if your financial institution offers a UPIC or for more information, go to http://www.upic.com or contact Sharon Jablon, 201.319.5516, or Sharon.jablon@epaynetwork.com.