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Launch · Financial Services

PhonePe launches UPI 123Pay for feature phone users

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PhonePe logo
Date
Company
PhonePe
What it does
Digital payments and financial services platform
Kind
Launch
Stage
growth
Based in
Bangalore
Founded
2016
Sector
Financial Services

What they do

PhonePe is a digital payments platform offering services like money transfers, bill payments, investments, and insurance to millions of users across India

What happened

The company launched UPI 123Pay, an SMS-based system allowing feature phone users to make payments without internet access or smartphones

Why it matters

This initiative targets 200 million feature phone users to drive financial inclusion and expand digital payment reach beyond smartphone-owning populations

The details

  • PhonePe has officially launched UPI 123Pay to enable digital payments for users with feature phones in India.
  • The service allows users to perform transactions without an internet connection by utilizing an SMS-based system.
  • It is designed to support users in areas with limited 2G connectivity who lack access to smartphones.
  • The feature will come pre-installed on devices from brands including Nokia, HMD, Lava, and Itel.
  • Users can perform person-to-person transfers, make merchant payments, check balances, and view transaction histories.
  • An AI-powered voice helpline supports English and 12 Indian languages to assist users with setup and navigation.

The bigger picture

  • The launch aims to reach India's 200 million feature phone users who are currently excluded from smartphone-based digital payments.
  • PhonePe intends to onboard the next 300 million users into the digital financial fold through this accessibility initiative.
  • The technology was developed following the June 2025 acquisition of the GSPay technology stack from Gupshup.

About the business

  • PhonePe operates a comprehensive digital payments platform that facilitates money transfers, bill payments, and recharges.
  • The company offers a wide range of financial services including mutual funds, gold, insurance, and lending.
  • It provides business solutions such as payment gateways, POS devices, and SmartSpeakers for offline merchants.
  • The platform serves over 72 crore registered users and is accepted by more than 5 crore merchants.
  • PhonePe also operates the Indus Appstore and the wealth platform Share.Market as part of its broader ecosystem.

What happens next

  • The company plans to introduce bill payments and mobile recharges for feature phone users in future updates.
  • PhonePe intends to add Aadhaar-based onboarding for feature phone users to simplify the registration process.
  • The company is actively pursuing partnerships with additional handset manufacturers to expand device availability.

The deal

Type
launch

Founders

  • Sameer Nigam, Co-founder and CEO
  • Rahul Chari, Co-founder and CTO

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