As part of RBI’s Unified Payments Interface (UPI), a new feature has been announced called 123Pay. The RBI governor announced this feature earlier today, saying that it will benefit over 40 crore users of feature phones in India.

Feature phone users were up to now only able to conduct offline UPI transactions by using USSD codes, according to the RBI. Currently, only a limited number of telecom operators offer USSD-based UPI services – and this service.
In India, the new 123Pay feature will simplify the process of making cashless payments, even without a smartphone. The IVR (interactive voice response) number can be accessed from the bank account number linked to basic mobile phones.  This may allow users to make cashless payments. Additionally, feature phones can use apps, a missed-call mechanism, and proximity-based payments.
India has continued to see the adoption of smartphones, as well as the penetration of internet connectivity, accelerate. As more users bought smartphones in 2021, the Indian smartphone industry grew by 11 percent. Over the past couple of years, various reports have observed an increase in the use of smartphones among users as a result of distance learning.
With 123Pay, RBI aims to boost the volume of UPI transactions. As per Das, UPI transactions have already hit Rs 76 lakh crore in FY 2021-22. That is more than double what UPI transactions were in FY 2020-21. UPI Transactions could surpass Rs 100 lakh crore every financial year if UPI is offered to feature phone users.