National Payments Corporation of India on Tuesday said it will be launching a pilot project of making merchant payments through mobile phones in three months with the involvement of six banks, including country's largest lender State Bank of India.

"Six banks, including State Bank of India, ICICI, UBI and Kotak Mahindra Bank have volunteered to start the merchant payments through mobiles service to their customers and we will start a pilot with them in three months," NPCI's Managing Director and Chief Executive, A P Hota, told reporters here.

The Reserve Bank had on May 3 allowed banks to allow its customers to make merchant payments through their mobile phones using the recently launched Mobile Payment Service run (IMPS) by NPCI.

Hota said through this service, account holders will be able to make many payments over their cell phones, including insurance payments, making donations to trusts etc.

Presently, with the IMPS, only individual to individual payments are allowed.

The RBI has set transaction limits of Rs 5,000 for a SMS- based payment and Rs 50,000 for the more secure application based payments, Hota said.

After launching the merchant payments through mobile phones, NPCI will concentrate on launching the channel integration project which will result in transfers between various modes like from an automated teller machine to mobile phone and vice-versa, Hota said.