India is rolling out voice-based payments to close the digital divide

India has announced plans to further expand digital payments by introducing AI-powered voice transactions and offline transactions. These new measures are expected to strengthen the country’s digital infrastructure while closing the digital divide. 

The development of India’s digital payments system - Universal Payments Interface (UPI) - is part of a wider plan to strengthen India’s digital infrastructure and bring the world's most populous nation online. 

Since its launch in 2016, the number of digital transactions have surged - with about 350 million people now using UPI to make payments of transfer money. UPI recorded almost 10 billion transactions in July.

However, its uptake has so far been concentrated in India's largest cities. The system has struggled to break into the country’s more rural regions due to unreliable internet access and lower levels of literacy - widening the digital divide between rural and urban areas. 

Closing the gap

In an effort to close this gap, the Reserve Bank of India (RBI) has this month unveiled a plan for “conversational” payments, allowing UPI users to make verbal transfer instructions on their phones which will be processed using AI-based speech recognition. 

The service will use open-source AI language tools developed by the Indian Institute of Technology Madras. Initially available in English and Hindi, the service is expected to  expand to encompass a variety of Indian languages. The channel will be accessible through both smartphone and feature phone-based UPI platforms, ensuring “a broader reach and deeper digital penetration,” RBI said. 

Users will also be able to make transactions without the internet by using “near field communication” technology, which is based on a system that uses a connection between two close-by phones. This will “enable retail digital payments in situations where internet [or] telecom connectivity is weak or not available”, the RBI said.

The new measures, which will be introduced in the coming month, are expected to redefine the user experience - making digital transactions even more seamless and user-friendly.