PhonePe has has acquired GSPay technology stack from messaging platform Gupshup, to introduce UPI-based payments for feature phones.

The GSPay acquisition will be integrated with PhonePe's existing services, leveraging the UPI 123PAY platform developed by the National Payments Corporation of India (NPCI) for feature phones. 

PhonePe will customise and extend the recently acquired GSPay IP and launch its own feature-phone based UPI payment mobile app on new feature phones in India, over the next few quarters, the company said.

"This (feature phones) segment of users has been historically underserved by the digital financial industry and the broader startup ecosystem. We hope we can enable crores of these feature phone customers to participate in India’s burgeoning digital payments market," PhonePe CEO Sameer Nigam said. 

PhonePe's focus on feature phones aligns with their broader strategy to ensure full payment interoperability between different types of mobile devices. With close to 24 crore feature phone users in 2024, and an additional 15 crore phones expected in the next five years, this development seeks to bridge the digital divide and enhance financial inclusion, the company stated.

The Bengaluru-based payments giant is preparing for a potential initial public offering (IPO).