New Delhi: While releasing the RBI Monetary Policy, RBI Governor Shaktikanta Das on Wednesday announced that the central bank will launch digital payment systems for feature phones. With this announcement, the central bank will allow Unified Payments Interface-based (UPI) products to be available on feature phones. The latest move will make internet-free UPI payments system a possibility in the days to come.Also Read - RBI Conducts Overnight VRR Auction Of Rs 75,000 Crore, Gets Bids Worth Rs 1.37 Trillion
Giving further details, Shaktikanta Das proposed three measures to make UPI payments simpler for consumers across the country. Also Read - After Winter Session, Crypto Bill Unlikely To Be Introduced In Budget Session Too
He said that the UPI is the single largest retail payments systems in the country in terms of volume of transactions, indicating its wide acceptance — particularly for small value payments. Also Read - How To Make UPI Payment Without Internet: A Step-By-Step Guide Here
He further added that to make digital payments more inclusive, ease transactions for consumers, facilitate greater participation of retail customers in various segments of the financial markets and enhance the capacity of service providers, it is proposed to launch UPI-based payment products for feature phone users leveraging on the Reserve Bank’s regulatory Sandbox on Retail Payments.
He also said the process will be made smooth for small value transactions. “Make the process flow for small value transactions simpler through a mechanism of ‘on-device’ wallet in UPI applications,” he added.
During the press briefing, the RBI governor proposed to enhance the transaction limit for payments through UPI for the Retail Direct Scheme for investment in G-secs and Initial Public Offering (IPO) applications from Rs 2 lakh to Rs 5 lakh.
Saying that the RBI has been making efforts to facilitate greater participation of retail customers in financial markets, the governor said the UPI has become a popular payment option for Initial Public Offerings (IPOs) since its availability from January 01, 20194.
It was reported that IPO applications of Rs 2 to Rs 5 lakh constitute approximately 10 per cent of subscription applications. However, the transaction limit in the UPI was enhanced from Rs 1 lakh to Rs 2 lakh in March 2020.
To encourage the use of UPI by retail investors, the RBI said it has proposed to enhance the transaction limit for payments through UPI for retail Direct Scheme and IPO applications from Rs 2 lakh to Rs 5 lakh.