The Reserve Bank of India (RBI) in its third Monetary Policy Committee (MPC) meeting of this fiscal has announced to enhance the transaction limit for small value digital payments in off-line mode from Rs 200 to Rs 500 within the overall limit of Rs 2000 over the payment instrument.
RBI has proposed to enable “Conversational Payments” on UPI by bringing in various parameters over the payment system.
This mechanism will enable users to engage in conversation with AI-powered systems to make payments.
Also, the users will be able to make offline payments on UPI using Near Field Communication (NFC) technology through ‘UPI-Lite’ on-device wallet.
The Governor said the move is to further deepen the reach and use of digital payments in the country.
UPI Lite was introduced by the National Payments Corporation of India (NPCI) and RBI in September 2022 as a simplified version of the original UPI payment system. It enables users to conduct small-value transactions seamlessly without facing banks’ occasional processing failures.
“The integration of conversational payments promises to elevate transactional convenience, enhancing the overall user experience. Simultaneously, the incorporation of near field technology for offline payments addresses connectivity challenges, ensuring seamless transactions even in areas with limited network access. This move not only simplifies transactions but also ushers in a new era of accessibility and ease for individuals and businesses alike,” said Rajsri Rengan, India Head of Development, Banking and Payments, at FIS.
“As India’s financial technology landscape evolves, these innovations align perfectly with our nation’s commitment to technological advancement and inclusive economic progress. Ultimately, these advancements are expected to stimulate consumer spending, drive business efficiency, and open up new avenues for economic expansion across sectors,” she added.
In order to use the facility, users need to download a UPI Lite-enabled app. Once installed, they can create a UPI Lite ID and add money to their UPI Lite balance.
It is to be noted that India has been aggressive towards the global penetration of UPI through tie-ups with countries like Singapore, UAE, Sri Lanka, Indonesia and France.
