PhonePe has announced that it is planning to launch a Unified Payments Interface (UPI) solution for new feature phone users in India. The digital payments and financial services company highlighted that its upcoming payment solution will be built on the NPCI’s UPI 123PAY technology. The service will be built on conversational engagement platform Gupshup’s GSPay tech stack, and the company plans to offer support for basic UPI features on feature phones. However, the service said that it could take a few quarters before the UPI service is launched in the country.
PhonePe’s UPI Solution for Feature Phones Is Built on GSPay
In a press release, the company announced that it has purchased the intellectual property (IP) of Gupshup’s proprietary GSPay technology stack. PhonePe will now customise this platform and build its UPI solution on top of it. Notably, Gupshup launched GSPay in 2023 as an SMS-based payment experience for feature phones.
PhonePe highlighted that GSPay is built in accordance with National Payments Corporation of India’s (NPCI) UPI 123Pay service which was launched in 2022 by then RBI Governor Shaktikanta Das. Now, the company plans to build its UPI solution by extending GSPay’s technology stack.
UPI 123Pay is a real-time UPI solution that does not require Internet service, designed for feature phones and users with limited connectivity. It offers four transaction methods which includes calling an interactive voice response (IVR) number, app-based service, missed call-based approach, and a sound-based proximity payment system.
The company’s UPI solution will also offer a wide-range of features. It will support person-to-person (P2P) transfers, offline QR code-based payments, and it will also allow users to receive money from other UPI users to their mobile numbers of self-QR codes. PhonePe stated that this solution is aimed at creating “full payment interoperability between feature phones and smartphone users’ in India.
Highlighting the scope of the UPI solution, PhonePe quoted industry data, according to which there were 24 crore feature phone users in 2024. Additionally, 15 crore feature phone shipments are also expected in the next five years, the company added. “This segment of users has been historically underserved by the digital financial industry and the broader startup ecosystem,” said Sameer Nigam, Co-Founder and CEO at PhonePe.
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