In a country as diverse and vast as India, where the boundaries of progress are constantly expanding, one innovation stands out among the rest – UPI (Unified Payments Interface).

UPI is a digital payment platform that transcends geographical limitations and empowers all communities to transfer money in just seconds. With just a few taps on a smartphone, users can send and receive payments instantly anywhere in the country. So popular is UPI that just in the past 12 months, daily transactions using this technology have grown from 24 crores to 36 crores – a jump of 50%! Since its launch in 2016, it has become the go-to payment choice, accounting for 75% of the total online payment volume.

Building on this success, the National Payments Corporation of India (NPCI) has launched UPI Lite and UPI 123Pay. Let’s understand these new platforms.

What is UPI Lite?

UPI Lite has been designed specifically for India’s rural population that relies on multiple low-value transactions on a day-to-day basis. While there is a limit to the number of daily transactions that can be performed with UPI, UPI Lite has no daily cap for low-value transactions.

Users can load up their on-device wallets and conduct as many transactions of up to Rs. 200 as possible. Without the need to connect the wallet to a bank account, this enables instant money transfer without the need for a PIN or bank confirmation.

The maximum amount that can be added to the on-device wallet is Rs. 2,000 twice daily, or a total daily limit of Rs 4000. UPI Lite Indian bank acceptance is steadily increasing.

Benefits

• Allows users, especially those in rural areas, to easily conduct transactions ranging from Rs. 1 to Rs. 200.
• Money is transferred instantly without the need for UPI PIN or bank confirmation. 
• No daily limit on the number of low-value transactions.

What is UPI 123Pay?

UPI 123Pay is a feature that will further increase the reach of financial services in the country, allowing users without an internet connection to participate in the digital payment system.

This method has been created for those users who do not have a smartphone and instead use a feature phone. It  works in the following ways:

1. Payment through IVR

Users can dial one of three IVR numbers (080 4516 3666, 080 4516 3581, or 6366 200 200) from their feature phone to make a UPI transaction.

2. Payment through missed calls

Users can give a missed call on the number displayed at a merchant to initiate a UPI transaction. 

3. Payment through feature phone app

A UPI app, similar to the one on smartphones, is available on feature phones to enable UPI payments. Although it has less functionality than the smartphone version, it allows users to send and receive money without the internet.

4. Payment through sound-based technology

This feature is proximity-based and uses sound waves to enable contactless transactions. Users can tap a feature phone at merchants using a ToneTag VoiceSe system which will automatically call the IVR number 6366 200 200 and initiate UPI payment.

Benefits

• Enables users without smartphones to participate in UPI payments.
• Brings the rural population into the digital payment revolution.

Conclusion

In conclusion, UPI has emerged as a game-changer, revolutionising financial inclusion in India, and UPI Lite and UPI 123Pay will continue this transformation and bring the power of financial services to the fingertips of millions in rural areas.