PhonePe has launched UPI 123Pay, enabling feature phone users to make UPI payments without an internet connection. Through this initiative, PhonePe has become the first major Third-Party Application Provider (TPAP) to extend UPI payment facilities to India’s more than 200 million feature phone users.
The service is intended to take digital payments beyond smartphone users, especially in regions where smartphone ownership and reliable internet access remain limited.
How Does PhonePe UPI 123Pay Work?
UPI 123Pay operates through an SMS-based technology architecture. This allows transactions to be completed even in areas with limited 2G connectivity, making the service suitable for users who may not have access to mobile internet.
Using supported feature phones, customers can carry out:
- Peer-to-Peer (P2P) payments through mobile numbers or UPI IDs.
- Peer-to-Merchant (P2M) payments through UPI IDs and QR codes.
- Account-related activities, such as checking bank balances and viewing transaction history.
The service is supported by a technology stack developed specifically to bring UPI functionality to feature phones.
Feature Phones Supporting UPI 123Pay
Initially, UPI 123Pay will be pre-bundled on selected devices manufactured by: Nokia, Lava International, HMD, Itel Mobile, which is part of Transsion Holdings
PhonePe plans to establish partnerships with more handset manufacturers in the coming months, allowing the service to reach a wider range of feature phone users.
AI-Powered Helpline for Users
PhonePe has also introduced a voice-first, AI-powered helpline to help users set up and activate the service.
The conversational voice assistant:
- Supports users in English and 12 Indian languages.
- Provides step-by-step assistance during registration, setup and activation.
- Responds to basic questions related to UPI payments and usage.
Unlike traditional Interactive Voice Response (IVR) systems, which generally provide users with fixed menu options, this assistant is designed to interact conversationally and offer more personalised guidance.