The Reserve Bank of India (RBI) has announced a series of innovative fintech initiatives aimed at enhancing the country’s Unified Payments Interface (UPI). Among these developments is the introduction of AI-driven “conversational” payments, allowing users to engage in dialogue with an AI system to initiate and complete transactions. This feature will be available on both smartphone and feature phone platforms, initially supporting interactions in Hindi and English.
In its effort to promote financial inclusion, the RBI is also exploring mechanisms for enabling offline payments through the UPI system. Last year, the launch of UPI-Lite, an on-device wallet designed for small-value transactions, marked a significant step forward. This product is currently successfully processing over ten million transactions monthly. To further advance UPI-Lite adoption, the bank plans to incorporate NFC technology for offline transactions.
Additionally, as part of its strategy to support fintech companies and startups in providing credit products, the RBI is addressing challenges related to data fragmentation. The existing credit assessment process is hindered by the dispersion of necessary information across various entities and systems, making timely and frictionless access difficult.
To tackle this issue, the RBI initiated a pilot program last year focused on the digitalization of Kisan Credit Card loans, aiming to streamline the lending process in a completely paperless manner. Preliminary results from this initiative have been promising.
A new digital platform is currently under development to ensure a frictionless flow of essential digital information to lenders. This end-to-end platform will feature an open architecture with APIs and standards, allowing seamless integration for all participants in the financial sector through a ‘plug and play’ approach.