TL; DR
- NPCI is reportedly building an NFC-based offline UPI feature that skips the internet entirely
- It’ll run off UPI Lite balances, capped at ₹2,000 per transaction, no PIN needed
- USSD’s *99# and voice-based UPI 123Pay already do “offline” payments, but they still lean on GSM or a phone line
- The real bottleneck isn’t NPCI’s certification process, it’s how many Indian phones still ship without an NFC chip
According to a Business Standard report, the idea is simple: load your UPI Lite wallet while you have data, then just tap your phone against a merchant’s terminal (or another NFC device) to pay. No PIN or signal needed. NPCI is expected to start certifying PoS manufacturers for this later in the year.
Existing Offline UPI Methods
This isn’t NPCI’s first attempt at offline payments, it’s just the first one that’s actually offline. *99# already lets you pay over USSD on any GSM phone, smartphone or ancient Nokia, across 83 banks and 13 languages, capped at ₹5,000.
UPI 123Pay does the same over a voice call for feature-phone users, in 12 languages, with a ₹5,000 per-transaction and ₹1,00,000 daily limit. Both have done real financial-inclusion work in low-connectivity areas. But “offline” for either of these still means you need a GSM signal or a working phone line. NFC is the first version that needs neither.
Why NFC Is Better?
That’s also what makes it a meaningfully better experience day to day, not just for someone in a dead zone. Tap-and-go beats dialing a USSD code or sitting through a voice menu, and NFC’s short range makes it inherently harder to intercept than something like Bluetooth, since the devices have to be physically close for the handshake.
The Biggest Challenge is the Lack of NFC Support on Many Phones
Here’s the catch, though: none of this matters if your phone doesn’t have an NFC chip, and a lot of budget and even mid-range phones in India still ship without one.
That’s a problem specifically because the audience this feature is meant to help, people relying on cheaper phones and patchier connectivity, are the least likely to own a phone that supports it.
We Still Don’t Know How This Will Actually Work
A couple of things NPCI hasn’t clarified yet: whether merchants need new certified terminals or can get by on a software update (the PoS certification angle suggests it’s not software-only), and whether this extends beyond merchant payments to phone-to-phone taps.
NFC is inherently peer-to-peer capable, and a no-PoS, tap-to-pay-a-friend flow would honestly be the more interesting use case for most people, but the report only frames this around merchant terminals for now.
Bottom Line
This is overdue and a good idea on paper, a payment method that doesn’t care about signal or data is really useful. But it’s only as good as adoption on both ends, merchants need certified NFC terminals, and users need phones that actually have the chip.
NPCI can build the best offline rail possible, and it still won’t matter if half the country’s phones can’t tap into it. If this finally pushes phone-makers to stop gating NFC behind the premium tier, that alone would make this worth it. Rollout details, especially on the phone-to-phone question, remain to be seen.
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