Context:
The National Payments Corporation of India (NPCI) is developing an IoT (Internet of Things)-ready version of UPI, aimed at enabling autonomous payments via smart devices such as wearables, connected vehicles, and home appliances. This innovation is part of NPCI’s 2025 roadmap and supports its goal of tenfold growth in UPI transactions.
Key Highlights:
What’s Happening?
- The National Payments Corporation of India (NPCI) is developing an IoT-ready version of UPI.
- Smart devices like refrigerators, washing machines, smartwatches, connected cars, and smart TVs will soon be able to initiate UPI transactions independently — for example, paying for parking, metro tickets, or renewing subscriptions automatically.
How It Will Work
- Device-specific UPI IDs
- Each device will be assigned a unique virtual payment address, linked to the user’s main UPI account.
- Payment Mandates and AutoPay Features
- Implementation of delegated payment frameworks such as UPI Circle and AutoPay.
- Users will be able to define mandates and transaction limits per device for better control.
- Security and User Authorization
- Transactions will require pre-approved mandates, OTPs, or device-based authentication.
- NPCI plans to implement strict safeguards to manage risks and prevent unauthorized use.
Why It Matters
- For NPCI: Supports its goal of 10x expansion in UPI use cases and penetration.
- For Consumers: Enables seamless, contactless payments through everyday smart devices.
- For India: Boosts its role as a pioneer in embedded financial infrastructure, enhancing digital adoption and financial inclusion.
The Internet of Things (IoT)
The Internet of Things (IoT) refers to a network of physical objects embedded with sensors, software, and other technologies that enable them to connect and exchange data with other devices and systems over the internet. Essentially, it’s about making everyday “things” smart and interconnected, allowing them to communicate and automate tasks, often without human intervention.
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