While both provide backup power during mains outage, with

the UPS the switch is instantaneous whereas with the

Inverter there is a gap of a second or two. This gap is OK

for household gadgets such as lights, fans, fridge, etc. but

not OK for computers.

In technical terms:

UPS: The mains power comes to the UPS. The AC is converted

to DC and this DC is constantly charging the battery. The

output of the battery is fed to the Sine wave inverter and

it converts DC to AC and this feeds the equipment. Since

power out is always drawn from the battery, there is no time

lag when mains swicthes off; it justs stops the battery from

being charged and the UPS continues to supply power till the

battery runs out.

Inverter: The mains power comes to the Inverter. This is

directly sent to the output but the AC is also converted to

DC and this DC is constantly charging the battery. A sensor

and relay mechanism checks whether the mains is ON or OFF.

When the main switches OFF, the relay actuator triggers to

switch from mains to inverter. Rest is same like the UPS.

Because of this sensor and relay, there is a gap between

triggering.

UPS involves more costly circuitary and is therefor more

expensive to make and sell.