UPI 123Pay: Unlocking Digital Payments for Feature Phones

India's digital payments landscape has been completely transformed by the Unified Payments Interface (UPI). It's a game-changer, making instant, inter-bank transactions as easy as sending a text. In October 2025 alone, UPI hits a record 20.7 billion transactions worth ₹27.28 lakh crore, underscoring its dominance and positioning India as a global leader in real-time payments.

Despite the tremendous growth in digital payments, a large portion of India’s population still depend on feature phones.  In semi-urban and rural areas, where network connectivity is often a challenge and smartphones are a luxury, these simple, button-based devices are a lifeline. The inability of feature phone users to access UPI meant a vast population was left behind in the digital payment revolution.

Recognizing this, the National Payments Corporation of India (NPCI) launched UPI 123Pay in 2022. This innovative solution is designed specifically for feature phone users, to access UPI services without an internet connection. It's a simple, yet powerful solution that brings the convenience and security of UPI to an underserved people proving that financial inclusion isn't just about technology, but about accessibility.

This blog dives into how UPI 123Pay is transforming payment accessibility, why feature phones still matter, and what it means for banks, fintech’s, and India’s financial ecosystem.

Let’s dive into its basics.

What is UPI 123PAY?

UPI 123Pay is a payment solution designed specifically for feature phone users, enabling them to make digital transactions using their UPI ID without needing internet access or a smartphone. Launched in 2022 by NPCI in partnership with the Reserve Bank of India (RBI), this initiative aims to close the digital payment gap and extend the convenience of UPI to nearly 400 million users in remote areas across India.

To get started with UPI 123Pay, users must first link their bank account to their feature phone and create a secure UPI PIN. Once set up, they can easily perform a variety of transactions through user-friendly payment options tailored for those without smartphones, ensuring wider financial inclusion and access to digital payments for everyone.

How to Set-up and Make Payments with UPI 123Pay?

Setting Up Your UPI ID

Setting up a UPI ID on a feature phone is straightforward and enables users without smartphones to access digital payments easily. Follow these simple steps:

1. Link Your Bank Account: Dial *99# from your feature phone to access the UPI 123Pay menu. Choose your preferred language and select your bank from the list provided.
2. Verify Your Account: Confirm your bank account by entering details such as the last six digits of your debit card and its expiry date.
3. Set Your UPI PIN: Create a unique 4 or 6-digit UPI PIN that will authenticate your transactions. You will be prompted to enter this PIN during every payment to ensure security.
4. Get Your UPI ID: Once your account is linked and PIN is set, a UPI ID (also called Virtual Payment Address or VPA) is automatically created for you. This ID can be used for sending and receiving money.

Making Payments with UPI 123Pay

UPI 123Pay offers feature phone users four simple and convenient ways to perform digital transactions without needing internet or a smartphone. Here’s how it works:

• Interactive Voice Response (IVR): Users call a pre-set IVR number where they can follow voice prompts in multiple languages to send money, recharge, pay bills, or shop. This secure phone call method guides users step-by-step to complete transactions using their UPI PIN.
• Missed Call Payments: At merchant outlets, customers receive a token with their mobile number and bill amount. They give a missed call to a designated number, and soon get a callback prompting them to enter their UPI PIN to authenticate and complete the payment.
• App on Feature Phone: Some feature phones come preloaded with a simplified UPI app that enables users to make payments similar to smartphone apps.
• Sound-Based Payments: Users call an IVR, select “Pay to Merchant,” tap their phone on a merchant’s sound-enabled device, and complete the payment by entering the amount and UPI PIN. This contactless method works offline and is convenient for quick transactions.

Benefits of UPI 123Pay

UPI 123PAY solution brings several impactful benefits:

• Wider Reach: Empowers millions to make digital transactions easily, breaking the barrier of needing internet or advanced devices.
• Flexible Payment Options: Users enjoy multiple ways to pay whether via voice calls, missed calls, or simple keypad commands, choosing what’s easiest for them.
• Robust Security: With UPI’s trusted two-factor authentication, every transaction is secured to protect users from fraud.
• Inclusive Language Support: Offering services in many regional languages, it makes digital payments accessible and comfortable for India’s diverse communities.

UPI 123Pay vs. Regular UPI: Key Differences

While both platforms run on the same underlying UPI network, UPI 123Pay is specifically designed for accessibility, leading to some key differences:

• Connectivity: The most significant difference is that UPI 123Pay works without data connectivity, using voice, text, and sound-based technology instead of an app interface.
• Bank Linking: On UPI 123Pay, users can typically link only one bank account at a time, whereas the regular UPI app allows multiple linked accounts.
• Transaction Limits: While regular UPI allows a daily limit of ₹1 lakh (with higher limits for specific categories), each UPI 123Pay transaction is capped at ₹10,000, with a daily maximum of ₹1 lakh.
• Feature Availability: Due to device limitations, some features like scan-and-pay QR codes are not available on UPI 123Pay.
• User interface: UPI 123PAY uses voice, text, and sound-based technology for navigation and authentication in place of touchscreen app interfaces.

Despite these differences, the launch of UPI 123Pay marks a new era of financial inclusion. The convenience, security, and simplicity of UPI are now within reach for millions of feature phone users, fostering a more inclusive and robust digital economy. For banks, this is a massive opportunity to serve a new, untapped market and deepen customer relationships. While the potential is huge, M2P also supports this functionality with our UPI stack.

Our robust and comprehensive UPI stack is designed to integrate and launch this functionality for their customers seamlessly. Instead of a lengthy and costly in-house building, banks can leverage our technology to fast-track their go-to-market strategy.

Connect with us to know more about our UPI solutions.

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Source: 

1. https://bfsi.economictimes.indiatimes.com/articles/upi-transactions-surge-to-record-207-billion-in-october-2025/125013308
2. https://www.npci.org.in/what-we-do/upi-123pay/product-overview
3. https://www.npci.org.in/product/upi-123pay
4. https://www.wintwealth.com/blog/what-is-upi-123pay-how-to-use-it-and-how-is-it-different-from-the-current-upi-interface/
5. https://paytm.com/blog/payments/upi/upi-123pay-uses-benefits-methods/