NPCI Develops Offline UPI 'Tap-to-Pay' for Transactions Up to ₹2,000

The National Payments Corporation of India (NPCI) is reportedly developing a new offline 'tap-to-pay' feature for the Unified Payments Interface (UPI). This capability will utilize Near-Field Communication (NFC) technology to enable transactions at merchant point-of-sale terminals even when both the user's smartphone and the merchant's device lack internet connectivity. The proposed system would support transactions of up to ₹2,000, providing a seamless payment experience in areas with unreliable or absent internet access, such as aircraft cabins or underground metro networks.

To use this feature, users would pre-load their UPI Lite wallet while online. Once the wallet is funded, they can perform eligible transactions offline without the need for a UPI PIN. The merchant's terminal will capture the payment authorization locally and transmit the transaction data for verification once internet connectivity is restored. This approach aims to maintain the security and integrity of the UPI ecosystem while significantly expanding the reach of digital payments into challenging environments.

While the innovation promises to enhance digital payment accessibility, it has encountered resistance from several major Indian digital payments companies, including Paytm, CRED, and Flipkart's Super.money. These firms have raised objections, arguing that a "one-click" UPI checkout framework could potentially strengthen the market dominance of larger payment apps and reduce competition. As UPI continues its massive growth—having processed 22.72 billion transactions worth ₹28.92 lakh crore in June 2026—the debate over the competitive impact of new features remains a critical point of contention for the industry.