RBI Launched A New UPI Solutions For Featured Phone Users
The Reserve Bank of India launched a new Unified Payments Interface (UPI) payments solution for feature phone users dubbed ‘UPI123Pay’. The unified payments interface (UPI) service, which was limited to smartphones to date, will be now available for feature phones without internet. The service is expected to benefit 40 crore feature phone users and is likely to increase digital financial inclusion, especially in the rural parts of the country. The initiative is envisioned to accelerate the process of digital adoption in India, by creating a richer and inclusive ecosystem that can accommodate larger sections of population.
UPI, which was introduced in 2016, has become one of the most used digital payments platforms in the country. The volume of UPI transactions has already reached ₹76 lakh crore in the current year, compared to ₹41 lakh crore in FY21. UPI123Pay will materially improve the options for such users to access UPI, who could earlier access the digital transactions platform through the USSD-based process, using the short code of *99#, which according to RBI is not popular. The USSD-based process is considered cumbersome, with users required to send multiple messages and charged for the same, and not supported by all mobile service providers.
UPI123Pay is a three-step method to initiate and execute services for users. It includes calling an IVR (interactive voice response) number, app functionality in feature phones, missed call-based approach and also proximity sound-based payments. The missed call feature would allow phones to access their bank accounts and perform routine transactions, such as receiving or transferring funds, regular purchases, bill payments, etc. A user just has to give a missed call on the number displayed at the merchant outlet. The customer will then receive an incoming call to authenticate the transaction by entering the UPI pin. The scan-and-pay function of UPI, available on smartphones, is not there on UPI123Pay.
Users can initiate payments to friends and family, pay utility bills, recharge the FAST Tags of their vehicles, pay mobile bills and also allow users to check account balances. Customers will also be able to link bank accounts, set or change UPI PINs. A 24x7 helpline for digital payments has also been set up by the National Payments Corporation of India (NPCI). The helpline christened 'Digisaathi' will assist the callers/users with all their queries on digital payments via website and chatbot. Users can visit www.digisaathi.info or call on 14431 and 1800 891 3333 from their phones for their queries on digital payments and grievances.
Mobile payment systems that do not rely on internet connectivity like the ones based on USSD or SMS technology were introduced many years ago and are still being used in some developing countries. In fact, one of the major mobile payment systems globally was introduced by Vodafone’s Kenyan associate, Safaricom in 2007. M-PESA, which is Africa’s leading mobile money service, operates across the Democratic Republic of Congo, Egypt, Ghana, Kenya, Lesotho, Mozambique and Tanzania, with 51 million customers making over $314 billion in transactions per year through the service, according to Vodafone.
The UPI 123Pay truly is an inclusive financial design product from RBI. We need to meet the rural or lower economic segments where they operate – feature phones, low bandwidth or no internet, vernacular support, and an easy to manage approach but noted that for the success of such an initiative, there are three big investments –device and data security, customer education and dispute resolution. The RBI estimates that overall volumes on UPI will touch Rs 100 crore soon and UPI123Pay could play a significant part in it.