UPI Offline Payments Soon? India May Introduce NFC-Based Payments Without Internet
India could soon introduce an offline UPI payment feature that would allow users to make digital payments even without an active internet connection, according to a Business Standard report citing three people familiar with the matter. The proposed UPI feature is aimed at making digital payments more reliable in areas where mobile network coverage is weak or unavailable.
UPI Payments May Work Without Internet on Phones and PoS Terminals
According to the report, neither the customer's smartphone nor the merchant's point-of-sale (PoS) terminal would require an internet connection for these UPI transactions to be completed. The National Payments Corporation of India (NPCI) is expected to begin certifying compatible PoS terminals for offline UPI payments later this year.NFC Technology to Power Offline UPI Payments
The report states that the upcoming offline UPI payment feature will be powered by NFC (Near Field Communication) technology. Once the feature is rolled out, users will reportedly be able to make payments by simply tapping their NFC-enabled smartphone on a compatible PoS terminal. Initially, each offline UPI transaction is expected to be limited to Rs 2,000.You may also like
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Feature Could Help in Areas With Poor Network Connectivity
The offline UPI payment system could be especially useful in locations where internet connectivity is unreliable. This includes remote regions, flights, and underground metro stations, where network signals are often weak or unavailable. The feature is expected to ensure smoother digital payments even in such situations.UPI Lite Wallet Expected to Handle Offline Transactions
According to the report, the offline payment system is expected to operate through an on-device UPI Lite wallet. Users would likely need to add money to the wallet while connected to the internet. Once the balance is loaded, they could make offline UPI payments at supported PoS terminals without requiring internet access or entering a UPI PIN. The payment amount would be deducted directly from the available UPI Lite balance.NPCI Certification Required for Offline UPI Acceptance
Point-of-sale companies will need certification from NPCI before they can begin accepting offline UPI payments. A person from a fintech firm quoted in the report said, “PoS companies will need a certification from NPCI to accept UPI in an offline setting. They can create an application on top of it after they get certified.”Merchants Can Build Tap-to-Pay Services After Certification
Once they receive NPCI certification, merchant PoS companies will be able to develop their own applications and services on top of the platform to support NFC-based tap-to-pay functionality for offline UPI payments.
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