The National Payments Corporation of India (NPCI) is set to revolutionize the digital payment landscape by introducing a new feature that will allow Unified Payments Interface (UPI) transactions even in areas with no internet connectivity. According to a report by Business Standard, this upcoming 'Tap-to-Pay' facility is being developed to ensure that customers can make payments at merchant Point-of-Sale (PoS) terminals even when both the sender's and the receiver's devices are offline. This move is expected to Notably boost digital payment adoption in remote or shielded locations where network reliability has traditionally been a challenge.
Implementation Timeline and Technology
The proposed system will use Near-Field Communication (NFC) technology, allowing users with NFC-enabled smartphones to simply tap their devices on an offline terminal to complete a transaction. Reports suggest that NPCI may begin the certification process for PoS devices from major terminal manufacturers starting in 2026. Once these devices are certified, fintech companies and banks can develop applications to support this offline ecosystem. The transaction limit for this offline tap-to-pay feature is expected to be set at 2,000 rupees per transaction, providing a substantial window for daily retail needs.
Targeted Use Cases: Airplanes and Underground Networks
One of the primary objectives of this initiative is to provide a smooth payment experience in environments where internet connectivity is either unavailable or highly unstable. This includes airplane cabins during flights and underground metro or train networks. Currently, many passengers face difficulties in making digital payments in these zones. The new system will allow users to pre-load funds into their UPI Lite wallet while they've an active internet connection. Once the wallet is funded, they can use that balance at offline terminals without the need for a UPI PIN, making the process both fast and efficient.
Certification and Hardware Requirements
For this system to function, PoS companies will require specific certification from NPCI to accept UPI payments in an offline setting. A PoS terminal is the hardware used by merchants to accept various forms of payment, including debit cards, credit cards, and mobile wallets. Under the proposed framework, the terminal will capture and store the payment authorization locally. Once the terminal regains internet connectivity, it will forward the stored data for final verification and settlement. Banks and third-party UPI application providers are already reportedly working on integrating this NFC-based use-case into their existing apps.
Evolution from UPI Lite X
This isn't NPCI's first foray into offline payments. In September 2023, NPCI introduced UPI Lite X to facilitate transactions without mobile connectivity. While UPI Lite requires no real-time access to the bank's core banking system but often needs some connectivity, UPI Lite X was specifically designed for fully offline person-to-person (P2P) payments between NFC-enabled phones. The new proposal extends this capability to certified traditional PoS terminals, broadening the scope of merchant payments. The June 2026 BHIM-UPI branding guidelines already include design specifications for NFC-enabled static and dynamic QR codes and soundboxes with 'Scan or Tap to Pay' instructions.
Regulatory Framework and Transaction Limits
The reported 2,000 rupees limit per transaction under this new program differs from some existing Reserve Bank of India (RBI) regulations. The RBI's offline digital payment framework, updated in December 2024, sets a limit of 500 rupees for general offline transactions and a total limit of 2,000 rupees on any single instrument. On top of that, UPI Lite allows payments up to 1,000 rupees with a total balance limit of 5,000 rupees. On top of that, the RBI's 'National Strategy for Financial Inclusion 2025-30' specifies a 500 rupees per transaction limit and a 4,000 rupees daily limit for UPI Lite X. NPCI is yet to publish the official operating rules to clarify how the new 2,000 rupees PoS limit will align with these existing frameworks.
Market Impact and Growth
The introduction of this feature comes at a time when UPI continues to see explosive growth. 92 lakh crore rupees. The ability to handle offline transactions opens up new opportunities, especially in sectors like aviation where some card issuers have restricted card usage due to operational hurdles. By providing a reliable offline alternative with a higher initial transaction limit, UPI is poised to capture a larger share of the micro-payment market in specialized environments.