The National Payments Corporation of India (NPCI) is creating a new Unified Payments Interface (UPI) feature that enables customers to make payments at merchant terminals without internet access, according to medianama.com. The system will use near-field communication (NFC) technology to process payments up to Rs 2,000 by tapping a phone on an offline point-of-sale (PoS) device. NPCI plans to start certifying PoS terminals from major manufacturers in 2026.
The offline payment system requires customers to preload funds into their on-device UPI Lite wallet while online. Once loaded, the stored balance can be used for offline payments without needing a UPI PIN. A fintech industry source explained that PoS companies must obtain NPCI certification before accepting offline UPI payments, after which they can develop supporting applications. The system captures tap-based authorization at the terminal and forwards the transaction for verification when connectivity is restored.
This new feature targets areas with limited or no connectivity, such as aircraft cabins and underground metro networks, where traditional online payments are challenging. It differs from NPCI’s earlier UPI Lite X, launched in September 2023, which supports fully offline transactions including person-to-person transfers. Banks and third-party UPI app providers are also independently developing offline payment capabilities within their own apps, indicating a broader push to expand offline digital payments in India.
NPCI’s offline UPI tap-to-pay feature is expected to become operational after PoS terminal certification begins later this year, marking a significant step in expanding digital payment access in connectivity-challenged environments.