UPI 123Pay

UPI 123Pay: RBI launches UPI 123Pay for non-smartphones

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The Reserve Bank of India (RBI) unveiled a unified payments interface (UPI) for feature phones on Tuesday, bringing around 400 million users of such phones into India’s domestic payments network. The RBI’s new UPI 123Pay service will allow feature phone users to make quick digital payments. RBI Deputy Governor T Rabi Sankar believes UPI for feature phones will be a game-changer, putting India’s rapidly expanding payment system on the global map.

T Rabi Sankar, deputy governor of the Reserve Bank of India, stated that while India has achieved great advances in digital payments, a big portion of this digitization is becoming confined to people who use smartphones. Because UPI has made significant contributions to India’s digital payments, UPI must be available as an offline mode and on feature phones to push it to the next stage of growth, according to Sankar, which has been the RBI’s work over the last two to three years.

The RBI first introduced UPI for feature phones during the December monetary policy meeting. Today is the official launch day. Along with the launch of UPI for feature phones, which will be available in all Indian languages, the central bank also introduced DigiSaathi, a 24-hour hotline for digital payments. Since its inception in 2016, digital payments via UPI have increased more than fivefold. This year, 453 crore transactions of Rs 8.26 lakh crore were completed in February alone, more than double the number of transactions completed the previous year.

Previously, digital payments via feature phones were available in the nation, but they were never widely adopted since they were based on USSD. Supplementary Service That Isn’t Structured Data-based services imply that consumers can utilise mobile banking without a smartphone or an internet connection by dialling the *99# number. However, the process is time-consuming, it is fee-based, and not every telecom operator offers the service.

How will feature phone users be able to make payments?

The RBI stated that it will provide four payment choices to users via a menu and that these functions will be expanded in the future. NPCI will allow feature phone users to make payments in 3 ways:

(i) The first method is to employ Interactive Voice Response (IVR) numbers. From a feature phone, one may dial a number and conduct a secure call, and after registering, one can begin financial transactions without internet access.

(ii) The second method is through an app-based channel, in which an app capability will be provided in a feature phone. Except for the scan and pay feature, all transactions accessible on a UPI app for smartphones will be available. The RBI is working hard to make a scan and pay functionality accessible as soon as possible.

(iii) The third way of feature phone UPI utilises sound-based payments based on proximity. This technology employs sound waves to establish networking, allowing for contactless offline and proximity data exchange on any device. The last technique is a traditional Indian method known as the missed call strategy, in which consumers receive a callback from a standard number to authenticate and complete transactions.

Das stated that the introduction of UPI 123Pay makes UPI amenities available to a segment of society that has previously been deprived of the digital payments scene. 

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