UPI, India’s favored method of digital payment, is undergoing a substantial enhancement with a range of fresh attributes.
A standout among these is Conversational Payments, an innovative approach enabling payments through interactions with AI-powered systems.
But there’s more to this upgrade. RBI Governor Shaktikanta Das unveiled additional enhancements for UPI during Thursday’s Monetary Policy Committee (MPC) gathering.
Here are all the details!
AI-Powered Conversational Payments
In the pursuit of leveraging advanced technology to amplify digital payments, the National Payments Corporation of India (NPCI) aims to introduce ‘Conversational Payments’ on UPI, allowing users to seamlessly make payments within a secure environment through conversations with AI-driven systems.
This feature will cater to both smartphones and feature phones, fostering broader digital adoption across the nation, as highlighted by Das. Initially available in Hindi and English, it will eventually expand to encompass more Indian languages. The RBI is set to provide directives to the NPCI in the near future.
While details on the mechanics of conversational payments remain undisclosed, it’s plausible that NPCI might incorporate an AI chatbot, such as ChatGPT, to assist users with their payment processes.
Increased UPI Transaction Limit
RBI has also proposed an elevation in the transaction cap for UPI Lite, raising it from Rs 200 to Rs 500 for offline transactions. The RBI has established a limit of Rs 200 per transaction and Rs 2,000 per payment instrument for low-value digital transactions conducted offline, including those involving the National Common Mobility Card (NCMC) and UPI Lite.
This channel doesn’t necessitate two-factor authentication, it enables swifter, more dependable, and touchless payments for minor transactions and transit-related payments.
“To accommodate the growing demand for expanded limits and to encourage wider acceptance of this mode of payment, it is now recommended to raise the per transaction threshold to Rs 500,” explained Das.
However, the overall cap of Rs 2,000 remains intact to mitigate the risks associated with relaxing two-factor authentication. Detailed directives from the RBI on this matter are imminent.
Offline UPI Payments via NFC
Das has also introduced offline UPI payments utilizing near-field communication (NFC) technology through UPI Lite.
As per a statement by MPC, “To promote the use of UPI-Lite, it is proposed to facilitate offline transactions using NFC technology. This feature will not only enable retail digital payments in situations where internet or telecom connectivity is weak or not available, it will also ensure speed, with minimal transaction decline.”
This innovation will simplify payments, as users will merely need to tap their smartphones on the point-of-sale (PoS) machine.
