RBI governor Shaktikanta Das launches UPI for feature phones, says move will bump up digital adoption

RBI Governor Shaktikanta Das (File image)

Reserve Bank of India (RBI) governor Shaktikanta Das on 8 March rolled out Unified Payments Interface (UPI) for feature phones, saying the move will bump up digital adoption, and launched a 24x7 helpline for digital payments called DigiSaathi.

UPI 123Pay will allow customers to use feature phones for almost all transactions except scan and pay. It doesn't need internet connection for transactions. Customers have to link their bank account with feature phones to use this facility.

UPI on feature phones will help people in rural areas who cannot afford a smartphone to participate in UPI transactions, Das said. "This current decade will witness a transformative shift in the digital payments ecosystem in the country," he said, adding the RBI has announced several measures in the last three years to push digital transactions.

Also, Das stressed the need to focus on cybersecurity and said systems need to be prepared to face such cyber risks.

The RBI, in a press release, said the UPI123Pay includes four distinct options as below:

(a) App-based functionality: An app would be installed on the feature phone
through which several UPI functions, available on smartphones, will also be
available on feature phones.

(b) Missed Call: This will allow feature phone users to access their bank account and perform routine transactions such as receiving, transferring funds, regular purchases, bill payments, etc., by giving a missed call on the number displayed at the merchant outlet. The customer will receive an incoming call to authenticate the transaction by entering UPI PIN.

(c) Inter-active Voice Response (IVR): UPI payment through pre-defined IVR numbers would require users to initiate a secured call from their feature phones to a predetermined number and complete UPI on-boarding formalities to be able to start making financial transactions without internet connection.

(d) Proximity Sound-based Payments: This uses sound waves to enable contactless, offline, and proximity data communication on any device.

The move comes after the central bank in December announced a plan to introduce UPI in feature phones, which has remained confined to smartphones as a payment platform ever since rolling out in 2016, limiting its use among people in rural areas having feature phones

Since the UPI payment platform was introduced in 2016, transactions have grown multifold.

Now, enabling UPI on feature phones will increase digital penetration of financial services and help a large segment of people without access to smartphones or reliable internet services to transact digitally.