UPI123Pay- RBI’s new payments service for feature phones

UPI123Pay- RBI’s new payments service for feature phones

Subject: Science & Tech

Section: IT related

Context- The unified payments interface (UPI) service, which was limited to smartphones to date, will be now available for feature phones without internet, courtesy the Reserve Bank of India’s (RBI) UPI123Pay.

Concept-

How does one use UPI123Pay:

• UPI123Pay is a three-step method to initiate and execute services for users.
• The users will be able to undertake a host of transactions based on four technology alternatives including-
  • 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.
  • 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.
  • Interactive 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.
  • Proximity Sound-based Payments: This uses sound waves to enable contactless, offline, and proximity data communication on any device.
• The scan-and-pay function of UPI, available on smartphones, is not there on UPI123Pay.

How does it take the UPI programme forward:

• Even though UPI can alternatively be accessed through the National Unified USSD Platform using the code *99#, the process has not seen an uptick in adoption or popularity.
• However, with UPI123Pay, it would reach 40 crore feature phone users in the country, potentially making a material improvement in the way they access the popular payments platform.

What is Unified Payments Interface (UPI)?

• NPCI launched UPI with 21 member banks in 2016.
• It is an advanced version of Immediate Payment Service (IMPS)-round–the-clock funds transfer service to make cashless payments faster, easier and smoother.
• UPI is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing & merchant payments into one hood.
• UPI is currently the biggest among the National Payments Corporation of India (NPCI) operated systems including National Automated Clearing House (NACH), Immediate Payment Service (IMPS), Aadhaar enabled Payment System (AePS), Bharat Bill Payment System (BBPS), RuPay etc.
• The top UPI apps today include PhonePe, Paytm, Google Pay, Amazon Pay and BHIM, the latter being the Government offering.