NPCI kickstarts deployment of 'UPI Tap and Pay' facility for payment apps

The National Payments Corporation of India (NPCI) has kick-started the process to deploy ‘UPI Tap and Pay’ across digital payment providers after the apex body released details on the feature’s roll out. 

Unified Payments Interface (UPI) members can go live with the UPI Tap and Pay functionality by January 31, 2024, NPCI said in a circular reviewed by Business Standard.

However, the timeline mentioned in the circular is not a deadline for digital payment firms. 

“Payment players can roll out the UPI Tap and Pay feature on their apps any time. The date mentioned in the circular is just a recommendation and it will be desirable to see firms launching the service by that date,” a person close to NPCI said.

The person added that NPCI will continue to follow up with companies who may be unable to introduce the service within the timeframe.

The feature is currently live on Bharat Interface for Money or BHIM app along with Paytm where it is open for limited users, according to details on NPCI’s website.

Reserve Bank of India (RBI) Governor Shaktikanta Das had announced the launch of UPI Tap and Pay feature among other new digital payment functionalities at the Global Fintech Fest in September this year. 

The feature utilises near-field communication (NFC) technology to capture details about a payee’s UPI ID or a Virtual Payment Address (VPA) without capturing a quick response (QR) code via a camera. Mobiles and devices, which have the NFC capability, can use the service. 

The recent circular from NPCI recommends UPI applications to have a separate call-to-action (CTA) button for the feature on a payment app’s homepage. It will be available to users on android and ios operating systems. 

If a user enables the UPI LITE account for the tap feature, transactions with a value of less than Rs 500 will be processed through UPI LITE. Transactions of over Rs 500 will require a UPI PIN. 

However, to expand the service of UPI Tap and Pay, merchants will need to have UPI Smart QRs or tags, which are certified for NFCs. 

“Another reason why it may take a while to build the ecosystem is that these smart QRs or tags will take some time to manufacture from scratch and be deployed at different merchant spaces. It will be an ongoing process and may further move towards a cycle of mass production,” the person quoted above said. 

Acquiring banks will be liable for losses due to tampering of these smart QRs or NFC tags at merchant outlets. 

“Acquiring banks will perform periodic checks of the UPI Smart QRs installed at merchant outlets and ensure replacement, if required,” the NPCI circular reads. 

In September, along with the launch of UPI Tap and Pay, other digital payment features were also rolled out. They include a credit line on UPI, HelloUPI, and Billpay Connect. 

With Hello UPI for instance, users will now be able to make real-time payments with the help of voice commands via both smartphones and feature phones.

For smartphones, conversational UPI will be live on apps such as BHIM and PayZapp, among others.

The AI system works on acoustics, capable of identifying the difference between silence and sound, understands the language of conversation, the binary intent (a yes or a no) for approving or declining a transaction, and can also convert speech to text speech.

UPI transactions reached a new high in value in November, hitting Rs 17.4 trillion, up 1.4 per cent compared to Rs 17.16 trillion in October. Similarly, it recorded 11.24 billion transactions, a minor decline compared to a record high of 11.41 billion in October.

Digital reality

• Function currently live on BHIM app and Paytm 
• (open for limited users)
• Merchants should have UPI Smart QRs or NFC-certified tags to ensure transactions 
• Acquiring banks will be liable for losses in case of the tampering 
• Other latest UPI features include Hello UPI, credit line on UPI, and Billpay Connect