The Reserve Bank of India (RBI) on Tuesday launched a new digital payment mode — Unified Payments Interface (UPI) called UPI123Pay for feature phones. Till now, the UPI system has been limited to smartphones with internet connections. Thousands of people who use feature phones, have not been able to carry out UPI transactions using their phones. To include all such users and bring them into the mainstream digital payment, the central bank of India introduced this new mode of payment.
“UPI123Pay will digitally empower millions across the country and help NPCI achieve its dream of a billion plus daily UPI transactions,” said Biswamohan Mahapatra, NPCI chairman.
How UPI for Feature Phones will Work
UPI 123Pay will allow the users to make transactions via UPI via feature phones. Except scan and pay UPI option available for smartphone users, the feature phone users will be able to use all other features. UPI for feature phones does not need internet connection for transactions. Customers need to link their bank accounts with feature phones to use UPI 123Pay facility. Feature phone users can use various payments via new UPI feature — person to person to merchant payments. Initially, it is in Hindi and English.
UPI has emerged as one of the most used payment systems in India in the recent years. In terms of volume of transactions, UPI is the single largest retail payment system in the country. “While we have been growing impressively in digital payments, a large part of digitisation is limited to people with smartphones. There are about 40 crore feature phone users who had limited access to digital payments,” said T Rabi Sankar, RBI deputy governor. The aim is to bring a large number of feature phone users under the gambit of UPI payment method, he mentioned.
“This move is to further popularise the use of digital payments has proposed to introduce a framework for retail offline payments across the country. The background of this announcement comes from a series of successful pilot tests. The learning of these tests strongly suggest that there is more wiggle room for digital payment-related solutions especially in the remote parts of the country. With this development, the RBI is optimistic about increasing the ease of doing business in India along with more innovative fintech opportunities to capitalise on,” said Nitin Mathur, CEO, Tavaga Advisory Services.
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