UPI123PAY: Will Help In Financial Inclusion Of 40Cr Feature Phone Users
Linus tackles things head-on. He takes sides in his analysis and it fits excellently with our editorial policy. No 'maybe's' and 'allegedly' for him, only things in black and white.
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By Linus Garg
First publised on 2022-03-09 15:30:50
About the Author
Linus tackles things head-on. He takes sides in his analysis and it fits excellently with our editorial policy. No 'maybe's' and 'allegedly' for him, only things in black and white.
View all posts by this Author
In a move that is likely to have a huge positive impact on financial inclusion, the RBI on Tuesday extended the UPI platform to feature phones through the UPI123Pay technology. This means that potentially an additional 40 crore users can now freely use UPI for payments and transfers. The best thing is that no internet is required for this.
RBI deputy governor T Rabi Shankar said that while India has made significant strides in digital payments, a large part of this digitization is getting limited to those who have smartphones. Hence, he added that it is important that UPI is available as an offline mode and on feature phones to take it to the next phase of development.
The RBI had been working on this for some time now. Recognizing the fact that the benefits of the homegrown UPI platform was being missed by nearly 25% of mobile phone users as they did not have a smart phone, the RBI wanted a simple solution to allow them to use UPI . At present, such feature phone users can use UPI through a complicated and cumbersome system that was hardly used. Also, with connectivity issues in many parts of India, a system that did not require internet was designed.
Four different modules have been developed under UPI123Pay technology. These modules use IVR, apps, sound waves and missed call technologies to enable users to access the platform. An awareness campaign needs to be undertaken and feature phone users need to be educated on the use of UPI for them to avail the benefit.
UPI has grown by leaps and bounds in the last two years. From just 1.3bn transactions worth Rs 2.2 trillion, the figures now stand at 4.5bn transactions worth Rs 8.3 trillion in February 2022. The opportunity for 40cr more users on the platform is likely to see these figures jump manifold in the coming months.
