The Reserve Bank of India (RBI) has unveiled significant changes to the Unified Payments Interface (UPI), signaling a potential shift in the payments landscape.
These updates were disclosed by Shri Shaktikanta Das, Governor of the Reserve Bank of India during the RBI’s bi-monthly policy review. The Monetary Policy Committee (MPC) kept the key repo rate stable at 6.5 percent.
Conversational Payments with AI
In a bid to leverage cutting-edge technology for enhancing digital payments, the National Payments Corporation of India (NPCI) is set to launch ‘Conversational Payments’ on UPI. With this feature, users can securely carry out payment transactions through interactions with AI-enabled systems.
Accessible on smartphones and feature phones, it is anticipated to boost digital adoption in the country. Initially available in Hindi and English, other Indian languages will follow. Detailed guidelines will be provided by the RBI.
Higher UPI Transaction Limit
The RBI has suggested increasing the UPI Lite transaction limit from Rs 200 to Rs 500 for offline usage. This mode allows for quick, dependable, and contactless payments for small transactions and transit payments.
The overall limit for UPI Lite transactions will remain at Rs 2,000, despite the proposed increase in the offline mode limit from Rs 200 to Rs 500. This is to mitigate the risks associated with relaxing two-factor authentication. The aim of this decision is to encourage greater adoption of this payment method.
Offline UPI Payments
The Reserve Bank of India (RBI) is considering implementing offline payments using Near Field Communication (NFC) technology for UPI Lite. This feature allows for digital retail payments even in areas with poor or no internet or telecom connectivity.
The payment process involves tapping a smartphone on a point-of-sale (PoS) machine for easy payments. The National Payments Corporation of India (NPCI), which oversees UPI and UPI Lite, will receive guidelines for this feature.