PhonePe launches AI-powered search built using Microsoft Foundry

PhonePe Unveils Revolutionary AI Search Feature

PhonePe, one of India's leading digital payments platforms, has taken a significant step forward in enhancing user experience by introducing an AI-powered natural language search feature. Built in collaboration with Microsoft Foundry, this innovation lets users interact with the app using everyday voice or text commands, eliminating the need for cumbersome menu navigation. Imagine simply saying or typing "Pay Hemanth 20 rupees" and watching the app instantly open the payment screen with the recipient ready to go. This marks a shift towards more intuitive, intent-driven interactions that make financial tasks quicker and more accessible.

The announcement came on February 20, 2026, and highlights PhonePe's commitment to leveraging cutting-edge technology amid the booming AI landscape in India. Users can now handle everything from recharging FASTag to checking gold prices without digging through tabs. The feature interprets user intent accurately, whether it's processing a payment, completing a purchase, or seeking customer support. By combining on-device processing with cloud-based inferencing, it ensures smooth performance while prioritizing security—no personal or transaction data ever leaves the PhonePe environment. This hybrid approach balances speed, reliability, and privacy effectively.

How the Feature Works and Its Key Benefits

At its core, the AI search replaces traditional navigation with smart intent-based routing. For example, a command like "Show my recent transactions" pulls up relevant history instantly, while "Help with bill payment" guides users straight to support resources. Accessible through the app's Global Search Bar, Help Center, and History tab, it's designed for everyday use across urban and rural users alike. This is particularly helpful for less tech-savvy individuals, lowering the entry barrier in a country where digital payments have exploded in popularity.

PhonePe's move aligns with broader industry trends where AI is simplifying complex financial operations. The feature's rollout will happen in phases nationwide, starting soon after the launch at the AI Impact Summit 2026 in New Delhi. There, industry leaders gathered to discuss AI's role in shaping India's future strategies. As The emphasis on privacy reassures users in an era of growing data concerns.

"This AI-powered search is a game-changer, making payments as natural as speaking or typing a sentence, while keeping user data completely secure within our ecosystem," said a PhonePe spokesperson during the summit.

PhonePe's Growth and the Bigger Picture

Since its inception in 2016, PhonePe has grown into a powerhouse in India's fintech scene. The company offers a wide array of services, including consumer and merchant payments, insurance distribution, lending, and even investment platforms like Share.Market. By late September 2025, it boasted over 65 crore registered users and a vast merchant network spanning more than 4.7 crore points across the nation. This new AI feature builds on that foundation, aiming to personalize and streamline interactions further.

Experts see this as part of a larger wave where digital platforms integrate AI to cut down on friction in daily finances. Voice and text commands could especially benefit first-time users or those in semi-urban areas, accelerating India's digital payment adoption. PhonePe's partnership with Microsoft Foundry underscores the importance of global tech collaborations in driving local innovation. As the feature rolls out, it promises to set a new standard for convenience in mobile finance.

In summary, PhonePe's AI-powered search feature represents a smart evolution in digital payments, offering effortless navigation and transactions through natural language. With strong privacy measures and phased nationwide rollout, it positions the company at the forefront of AI-driven fintech advancements in India.