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PhonePe gets UPI Lite support, now lets users make payments without UPI PIN
In this article, we explained PhonePe UPI Lite and how you can use it to perform a low-value transaction without providing your UPI PIN.
PhonePe has enabled UPI (Unified Payments Interface) Lite payments on its app to enable speedier payments for smaller transactions, two months after its major competitor Paytm went live with the platform.
The new features would allow users to initiate low-value payments of less than Rs 200 with a single tap from their UPI Lite account without entering a pin, the Walmart-backed payments decacorn said in a statement on May 3.
A transaction is processed directly through UPI Lite by debiting the on-device UPI Lite balance without involving the customers’ banks’ (remitter bank) core banking systems in real-time, the company explained, making transactions more seamless and even faster than regular UPI transactions while also increasing the transaction’s success probability.
According to the business, UPI Lite on PhonePe is supported by all major banks and accepted by all UPI merchants and QRs across the country. According to sources, UPI Lite on Paytm was supported by nine banks, including Canara Bank, Central Bank of India, HDFC Bank, Indian Bank, Kotak Mahindra Bank, Punjab National Bank, State Bank of India, Union Bank of India, and Utkarsh Small Finance Bank.
PhonePe stated that customers may quickly activate the UPI capability on their PhonePe app through a simple method that does not require any KYC (know your customer) registration and also create a UPI Lite account. Furthermore, users can load up to Rs 2,000 on their Lite account and make transactions of up to Rs 200 or less at one go, according to the business.
To check the transaction history, users will receive a daily SMS from their bank with the history of UPI Lite transactions carried out during the day. This also results in decluttering bank statements and passbooks with small-value transactions, as the transactions are only displayed in the Lite account and not on the bank statement, according to the business.
“UPI Lite is a core component of the UPI stack offering, with the goal of improving users’ digital payments experience for frequent and low-ticket size spends.” “Small-ticket transactions account for a significant portion of overall UPI payments, and UPI LITE will make them faster and more convenient without putting a strain on the existing UPI infrastructure,” said Rahul Chari, co-founder and chief technology officer at PhonePe.
“UPI Lite also paves the way for the introduction of use cases that require payment execution without network connectivity, making it one of the most exciting NPCI launches in recent times.” “This is an important step towards increasing the adoption of digital payments for users across India, further strengthening a cashless economy,” he added.
What is UPI Lite?
UPI Lite is an on-device wallet designed for making small-value payments under Rs 200 without entering the UPI PIN. It was created by NPCI (National Payments Corporation of India), the same organization in charge of UPI development, to facilitate small-ticket payments in a speedy and secure manner. According to the NPCI, about half of UPI transactions are under Rs 200, while nearly 75% of retail transactions are under Rs 100.
Because the net value of low-volume transactions is so large, NPCI developed a UPI wallet feature that can especially cater to transactions under Rs 200 without putting pressure on the UPI infrastructure. As a result, even during peak UPI traffic, UPI Lite will function flawlessly because it is an on-device wallet that is not fully dependent on the UPI infrastructure.
The best part about UPI Lite is that you receive all of the benefits of UPI without the bother of payment failures. This means that you can scan and pay all UPI QR codes, as well as send money to VPAs or UPI IDs, phone numbers, and bank accounts. UPI Lite, on the other hand, can only accept payments of up to Rs 200. Furthermore, you can add money to the wallet using UPI and store up to Rs 2000 in the wallet.
Apart from that, UPI Lite will keep your bank account statement free of small-value UPI transactions. All of your UPI Lite transactions will be available in the app you use.
Key Features of UPI Lite
- With UPI Lite, you can only make payments of up to Rs 200. For payments under Rs 200, you do not need to submit your UPI PIN.
- You can fund your UPI Lite wallet with up to Rs 2000. Money can only be added to the UPI account, not by credit or debit card.
- Payments to UPI QR codes can be made from any merchant, UPI ID, phone number, or bank account.
- The funds will be directly credited to the recipient’s bank account. It will not be credited to the UPI Lite wallet.
- UPI Lite will function even if conventional UPI payments fail due to peak traffic. The wallet does not rely on UPI infrastructure to complete a transaction.
- UPI Lite keeps your account statement tidy. All of your UPI Lite transactions are only reflected in the app and not on your bank statements.
- While Offline mode is being advertised for UPI Lite, we have yet to see it in action.
- In an app, you can enable UPI Lite for only one bank account. You cannot use several UPI Lite wallets in the same app.
- You can withdraw funds from your UPI Lite account whenever you wish and without incurring any fees.
Here’s how PhonePe customers can use the PhonePe app to enable UPI Lite:
- Open the PhonePe app.
- Users will be able to enable UPI Lite from the app’s home screen.
- The user enters the amount to be added in UPI Lite and chooses the bank account.
- The UPI Lite account is successfully enabled after the user enters the UPI Pin.
PhonePe was founded in December 2015 and has grown to become India’s largest payments app, enabling digital inclusion for both consumers and merchants. With 45 crores (450 million) registered users, PhonePe currently has one in every four Indians.
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