The Reserve Bank of India (RBI) is set to bring more users under the ambit of the homegrown unified payments interface (UPI) channel, opening it up for feature phone users.
Feature phones are basic phones, which typically provide voice calling and text messaging functionalities. India has a large mobile phone consumer base of about 118 crore mobile users, of which about 74 crore have smart phones, indicating that there is a significant number of feature phone users in the country, RBI said. This points to the fact that feature phone users have limited access to innovative payment products like UPI, a real-time payment system developed by the National Payment Corporation of India (NPCI) for inter-bank transactions.
To be sure, feature phones currently have the national unified USSD platform (NUUP) option to avail of basic payment services using the short code of *99#, but RBI said this has not picked up.
“This move 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,” said Adhil Shetty, chief executive of financial services marketplace BankBazaar.com.
RBI also proposed enhancing the transaction limit on UPI payments for the retail direct scheme and initial public offering (IPO) applications to Rs. 5 lakh, from Rs. 2 lakh earlier. Launched recently, the retail direct scheme allows individual investors to directly invest in sovereign debt papers, aiming to bring more people into the bond markets and widening the market borrowing opportunity for the government.