From the very beginning, UPI aimed to become India's real-time online payment system. Initially, it was meant only for smartphone users. But, in India, the entire population does not carry a smartphone; rather, they have a basic mobile or feature phone solely for communication. However, they do transactions too, but they cannot opt to pay with UPI because their mobile devices don’t support that. To address this specific issue, NPCI introduced UPI 123Pay. Have a look at its details:

What Is UPI 123Pay?

Launched back in March 2022, UPI 123Pay is a version of UPI that enables millions of feature phone users to transact using UPI. For this version of UPI, NPCI has used call-based technologies like IVR or Interactive Voice Response, missed calls, etc.

The aim behind launching this solution is to bring millions of populations (non-smartphone users) under UPI. To conduct transactions with UPI 123Pay, users do not need an active internet connection as well. As per the latest RBI guidelines, Aadhaar OTP is mandatory to onboard these users on UPI 123Pay.

Check out the participant details of UPI 123Pay.

How to Pay Using UPI 123Pay?

NPCI showed 4 different ways to transact with UPI 123Pay:

1. IVR-Based Transactions

Here, the users need to dial any predefined IVR number from their feature phones and follow the directions to complete the onboarding. User will get the opportunity to complete the process in their preferred language. They can setup the PIN using a debit card or Aadhaar details. Once all set, users will get the following transaction options on the IVR:

• Money transfer
• LPG bill payment
• FASTag recharge
• Mobile recharge
• EMI repayments

They can check the account balance as well. To make a payment users only need to first complete the onboarding by linking bank account, and then, choose any of the payment options from above, choose the contact/merchant, enter the amount, and pay by entering the PIN.

This feature is available in 11 regional languages as of now and more languages will be added soon. UPI will notify the users after payment completion. This entire process is conducted on the call itself; hence, no need for data. Several banks are supporting this feature of UPI 123Pay.

2. Missed Call-Based Transactions

Feature phone users can also give missed calls to use UPI. MissCallPay has developed this solution and IDFC First Bank and Bank of India are the supporting banks here.

To pay using this, a user who is willing to pay through a missed call, has to inform the same at the billing counter so that the merchant can generate a token with customer's mobile number and amount. User then needs to give a missed call to the number displayed in the token. Immediately after that, the customer will receive a call from 08071 800 800 asking for authentication. User just needs to enter the PIN to authenticate and complete the transaction. After successful completion of the payment user will receive a success notification.

3. App-Based (Feature Phone Supporting App) Transactions

It is an app-like functionality for the feature phones – Gupshup supports this in collaboration with Airtel Payments Bank and Jio Pay supports this in collaboration with Jio Payments Bank. This app will be available only if the manufacturers (OEMs) support this.

This app will have a similar look and feel to UPI app but with certain limitations for working on a feature phone. To pay using these apps, the users need to

• 1. Open the app and link the bank account
• 2. Authenticate with OPT
• 3. Set the PIN
• 4. Select payment option (QR scan, contact number, etc.)
• 5. Enter amount and PIN

QR scan option may not be available in several smartphones. User will receive a success message after payment completion.

4. Proximity Sound-Based Transactions

Tonetag offers this feature in collaboration with NSDL Payments Bank. To pay using it, users can

• Call the IVR number
• Select “Pay To Merchant”
• Tap the phone on the merchant device
• Press # after the specified sound
• Enter the amount and PIN

User will receive a notification on completion of the payment.

Important Notes For UPI 123Pay

• Users cannot link multiple bank accounts here – it is the biggest difference between UPI and UPI 123Pay
• Entering the wrong UPI PIN thrice will temporarily block the user
• Users can only transact with the people who already use UPI

Use Cases

UPI 123Pay is a handy solution for real-time money transfers across India with utmost security. It includes P2P and P2M money transfers. Along with that bill payments, mobile recharges, FASTag refilling – all can be done using this.

Charges

Transactions with UPI 123Pay are absolutely free.

Daily Limits of UPI 123Pay

Initially per transaction limit with UPI 123Pay was 5000, but on 9th October RBI extended it to 10000 (effective from 1st January 2025). And in one day, the total transaction value must not exceed 1 lakh.

Benefits of UPI 123Pay

The benefits of UPI 123Pay include:

• Convenience in payment for non-smartphone users
• Helpful for merchants to accept online payments from anyone with/without a smartphone & internet
• Stronger security due to Aadhaar OTP authentication
• No internet dependency
• Short and simple onboarding for both merchants and users
• Zero cash dependency
• Available 24x7
• Excellent customer experience

End Words

In India, approximately 40 crore people use feature phones, and they use simple recharge packs for communication purposes. This population so far only heard of UPI since its launch in 2016 – but they could not use it only because their phones do not support this. With UPI 123Pay, this huge population can use UPI, alike smartphone users. So, RBI gets one step closer to a cashless economy. UPI is a mobile-first approach, but earlier mobile strictly meant smartphones, but UPI 123Pay is truly the UPI for feature phones. So, with this, the barrier of mobile type disappears, and entire Indian population can use UPI no matter what type of mobile they use.

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