RBI (Reserve Bank of India) is taking steps to promote digital payments in India by increasing transaction limits for UPI123Pay and UPI Lite. This decision was made during the recent meeting of the RBI’s Monetary Policy Committee (MPC) and aims to further boost the use of the Unified Payments Interface (UPI), especially among feature phone users and for small transactions.
UPI123Pay Transaction Limit
The RBI has decided to double the transaction limit for UPI123Pay from Rs 5,000 to Rs 10,000. UPI123Pay was launched in March 2022 to provide UPI services to feature phone users without needing an internet connection. It currently supports 12 languages, making digital payments easier for many people. With the new limit, the RBI aims to expand the use cases for UPI123Pay, allowing more users to make larger payments easily.
Limits for UPI Lite Wallet
Alongside UPI123Pay, the RBI has also increased the transaction limits for UPI Lite, which is designed for small-value transactions. The per-transaction limit for UPI Lite has gone up from Rs 500 to Rs 1,000, and the overall wallet limit has risen from Rs 2,000 to Rs 5,000. UPI Lite enables users to make quick payments without needing a full internet connection, making it convenient for everyday low-value transactions. This is the second increase in UPI Lite limits, following a previous adjustment made in August 2023.
These changes are part of the RBI’s larger plan to increase UPI usage among all parts of the population. UPI has already transformed India’s financial landscape by making digital payments more accessible. By raising the limits for UPI123Pay and UPI Lite, the RBI hopes to attract more users to the digital payment system, particularly those in rural areas and underserved regions who depend on feature phones.
NPCI Role in New Changes
The National Payments Corporation of India (NPCI), which manages the UPI platform, will provide the necessary guidelines to implement these changes. The new transaction and wallet limits are expected to take effect soon after NPCI informs banks and payment service providers about the details.
In addition to increasing limits, the RBI has proposed a new feature that will allow users to check the name of the recipient before making payments through Real Time Gross Settlement System (RTGS) and National Electronic Funds Transfer (NEFT). This feature, already available for UPI and Immediate Payment Service (IMPS), aims to reduce fraud and ensure accurate transactions.
