PhonePe, a Walmart-owned fintech company, has launched UPI payments for feature phones in India, enabling over 20 crore users to make digital transactions without internet access. The new service, called PhonePe UPI 123Pay, is the first major third-party application to offer UPI payments at scale for feature phone users, according to inc42.com.
PhonePe UPI 123Pay operates on an SMS-based system that works in areas with limited 2G connectivity. The service will come pre-installed on feature phones from manufacturers including Nokia, HMD, Lava International, and Itel Mobile, owned by Transsion Holdings. Users can make peer-to-peer transfers using mobile numbers or UPI IDs and pay merchants via UPI IDs or QR codes on camera-enabled devices. To assist users, PhonePe has introduced a voice-first, AI-powered helpline supporting English and 12 Indian languages. Registration involves selecting a bank, entering debit card details, and setting a UPI PIN.
This launch expands digital payment accessibility to a large segment of India's population that relies on feature phones rather than smartphones. By enabling UPI transactions without internet connectivity, PhonePe aims to drive financial inclusion in rural and semi-urban areas. The move positions PhonePe ahead of competitors by targeting a largely untapped market segment, complementing India's ongoing push for digital payments and financial inclusion.
PhonePe plans to partner with additional handset manufacturers to extend the reach of UPI 123Pay in the coming months, aiming to further increase adoption among feature phone users across India, inc42.com reported.