India has introduced a new tap-and-pay facility on its Unified Payments Interface (UPI), allowing users to make payments at point-of-sale terminals simply by tapping their smartphones. The launch comes as Apple prepares for a wider rollout of Apple Pay in the country.
UPI Gets Tap-and-Pay Facility
The National Payments Corporation of India (NPCI), which operates UPI, launched the new feature at the Global Fintech Fest in Mumbai.
The facility uses near-field communication (NFC) technology. Users can unlock a compatible smartphone and tap it against an NFC-enabled point-of-sale terminal to complete a payment without opening their UPI application.
The feature is particularly notable because the customer’s phone does not need an active internet connection. The transaction can use the internet connectivity available through the payment terminal.
Payments Without Opening a UPI App
The new system is designed to make UPI payments work more like conventional contactless card transactions while retaining the flexibility of the UPI ecosystem.
It supports different account types linked to UPI, including RuPay credit cards on UPI. Payments of up to ₹5,000 can be completed without entering a UPI PIN, while transactions above that threshold require PIN authentication on the point-of-sale terminal.
This could make UPI more convenient in situations where mobile connectivity is weak or unavailable.
UPI Continues Its Massive Growth
The launch comes as UPI continues to dominate India’s digital payments ecosystem. In August, the platform processed 24.51 billion transactions worth ₹29.82 trillion, equivalent to around $314 billion.
The scale of UPI means even relatively small changes to the payment experience can have a significant impact on how Indians pay at physical stores and other merchant locations.
The tap-and-pay system also builds on NPCI’s recent push toward faster authentication. Biometric-authenticated UPI transactions have already crossed 6.29 billion since the feature was introduced.
Apple Pay’s Full Launch Expected Soon
The UPI upgrade arrives just before the expected broader launch of Apple Pay in India.
A beta version of Apple Pay has reportedly been available in the country, while a full commercial rollout is expected by October. Apple’s entry could bring greater competition to India’s contactless payments market, particularly among iPhone users.
Rather than waiting for a new payment ecosystem to develop around Apple’s service, India’s existing UPI infrastructure is expanding its own contactless capabilities.
A New Phase for UPI
The tap-and-pay feature represents another step in UPI’s evolution from QR-code-based payments toward a broader range of contactless payment methods.
By combining NFC, offline phone connectivity and PIN-less transactions for smaller payments, NPCI is attempting to make UPI faster and more seamless at physical checkout counters.
Summary: NPCI has launched UPI Tap-and-Pay, enabling users to make NFC-based payments by tapping compatible smartphones at point-of-sale terminals. Transactions up to ₹5,000 can be made without a PIN, and the phone does not need mobile internet. The launch comes ahead of an expected full Apple Pay rollout in India.
