Unified Payments Interface (UPI) has become a popular payment mode for Indians across all age groups and income levels. It has become an essential part of our life for carrying on day-to-day transactions. With UPI becoming more integral to personal and business finance, the system’s regulations are also evolving.
Recently, a series of changes to UPI payments came into effect on November 1, 2024, which users of payment platforms, such as Paytm, PhonePe, and GPay should be aware of. These include auto-top up feature for UPI Lite and increase of the UPI Lite wallet limit, among others.
Incidentally, in October 2024, the Reserve Bank of India (RBI) had announced an increase in the transaction and wallet limits for UPI Lite, in addition to an auto top-up feature to simplify the process. The hike in transaction limit of UPI Lite is expected to be rolled out soon.
Here’s a breakdown of these new changes.
Auto-Top Up Feature For UPI Lite Users
For the ease of all UPI users, the National Payment Corporation of India (NPCI) has launched the UPI Lite auto top-up feature. UPI Life is a version of UPI that allows for quick and low-value transactions without the need for a PIN (password protection before making the transaction).
The top-up feature will allow users to automate the UPI Lite balance in their account when it dips below a set threshold. This would ensure that you can make small transactions without any interruption. Starting November 1, 2024 this is what the new feature has in store for you.
Automatic Top-Up: Now, you can set a minimum balance threshold within your UPI Lite account. When your balance dips below this limit, the system will automatically top-it-up from your linked bank account with a pre-selected amount. This amount can be changed or modified according to your need.
Easy Set-Up: You can authorise this feature by setting up an auto top-up mandate within the UPI app you use, such as Google Pay, PhonePe, Paytm, among others. You can adjust the balance threshold or cancel the mandate anytime, while still keeping full control over your spending.
Set Top-Up Limit: There is, however, a limit to how many top-ups you can make in a day. To ensure users have a grip over auto top-ups, these have been limited to five transactions per day.
Higher Transaction Limit For UPI
In addition to the auto top-up feature, RBI recently announced expanded UPI Lite limits for users which, when implemented, will enable the following:
- The single transaction limit will be raised from Rs 500 to Rs 1,000.
- Users will be able to keep a balance of up to Rs 5,000 in their UPI LIte wallet, which is an increase from the previous limit of Rs 2,000.
- The daily transaction limit remains at Rs 4,000 to foster responsible spending, while still raising the high-value transaction limit under UPI Lite.
These upgrades will make UPI Lite even more convenient, thus allowing users to carry a higher balance and make larger transactions without the hassle of reloading funds often
Record Breaking UPI Transactions In October
UPI crossed a significant milestone last month with a record-breaking 16.58 billion transactions worth Rs 23.5 trillion. This is the highest figure recorded since UPI’s inception in 2016.
Daily UPI transactions registered over 535 million payments per day, valued at Rs 75,801 crore. As compared to the previous year, October’s transaction volume grew by 45 per cent year-on-year (y-o-y), while transaction value rose by 37 per cent.
Such a surge in the volume of UPI transactions marks a 10 per cent increase from September 2024, and a 14 per cent rise in the transaction value. The ongoing festive season has likely fuelled this spike in transactions, particularly with person-to-merchant (P2M) payments seeing a sharp rise.
