From September 16, 2024, new changes are being introduced to the Unified Payments Interface (UPI) transaction limits. This move is part of the continuous effort to enhance the digital payments ecosystem in India. UPI, which has become one of the most popular payment methods, is used by millions of people across the country for fast, secure, and seamless transactions.
Here’s a detailed breakdown of the new UPI transaction limits, who they affect, and how these changes will impact users.
New UPI Transaction Limits
The National Payments Corporation of India (NPCI), which governs UPI, has revised the transaction limits for different types of payments. These changes are aimed at ensuring smoother transactions, reducing the load on UPI servers, and improving the security of high-value payments.
1. Peer-to-Peer (P2P) Transactions
- Old Limit: ₹1 lakh per transaction.
- New Limit: Remains unchanged at ₹1 lakh per transaction.
- Eligibility: All users with UPI-enabled bank accounts.
- Impact: There is no change for users making peer-to-peer transfers such as sending money to family, friends, or any other individuals.
2. Merchant Payments (P2M)
For payments made to merchants via UPI, different categories have been assigned with varying limits:
- Small Retailers:
New Limit: ₹2 lakh per transaction.
This is meant to boost digital payments in small businesses like grocery stores and kirana shops, making it easier for customers to transact without any hassle. - Large Merchants and Online Platforms:
New Limit: ₹5 lakh per transaction.
This change is applicable to high-value payments for services such as e-commerce platforms, utility bills, travel bookings, and other significant transactions. - Impact on Businesses: The higher limit allows businesses to handle more significant transactions through UPI, reducing dependency on cards or other digital methods.
3. IPO Applications via UPI
- Old Limit: ₹2 lakh per transaction.
- New Limit: ₹5 lakh per transaction.
- Eligibility: Investors applying for Initial Public Offerings (IPO) through UPI-linked bank accounts.
- Impact: This change will make it easier for retail investors to apply for higher-value IPOs through UPI, streamlining the process.
4. UPI AutoPay for Recurring Payments
- New Limit: ₹15,000 per transaction for recurring payments (such as subscriptions, utility bills, etc.) through UPI AutoPay.
- Impact: The limit ensures that users do not have to re-authenticate for low-value recurring payments, but higher amounts may need manual intervention or verification.
5. UPI Credit Card Payments
- New Limit: ₹2 lakh per transaction when linking UPI to credit cards.
- Eligibility: Users linking their RuPay credit cards to UPI.
- Impact: This enables users to make high-value purchases using credit via UPI, offering more flexibility in payment methods.
Why the Change?
The revised UPI limits are part of the NPCI’s efforts to improve the UPI infrastructure and make it capable of handling even larger volumes of transactions. Given the massive adoption of UPI in India, transaction volumes have skyrocketed, with millions of transactions processed daily.
These changes are also expected to enhance security, ensuring that high-value payments are more closely monitored and authenticated. Additionally, raising the limits on IPO applications and merchant payments aligns with the government’s Digital India initiative, promoting a more cashless economy.
How Will It Affect UPI Users?
For most regular users, these changes will have little impact. Peer-to-peer transactions remain capped at ₹1 lakh, which is sufficient for most individual users. However, if you regularly make high-value payments to merchants or through IPO applications, you will benefit from the increased limits.
Who Is Eligible for the New Limits?
All users with a UPI-enabled bank account are eligible for these updated transaction limits. It’s important to note that individual banks may impose their own UPI limits, which may be lower than the NPCI’s prescribed limits. Users should check with their respective banks if they face any restrictions.
How to Ensure a Smooth Transition?
- Update UPI Apps: Make sure you’re using the latest version of your UPI app to avoid any issues with transactions.
- Check with Your Bank: Confirm that your bank supports the new transaction limits and that your account is fully UPI-enabled for large payments.
- Watch for Notifications: Keep an eye on notifications from your bank and UPI apps for any specific updates regarding your transaction limits.
Conclusion
The changes to UPI transaction limits from September 16 are designed to benefit both users and businesses by allowing higher-value transactions while maintaining security. As UPI continues to grow in popularity, these adjustments will make it easier for users to make larger payments while promoting the adoption of digital transactions across India.
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