UPI Gets a Makeover: 7 New Changes You Need to Know

Unified Payments Interface (UPI) has been a game-changer in India’s digital payment landscape, providing users with a seamless and efficient way to conduct transactions. Recently, the National Payments Corporation of India (NPCI) and the Reserve Bank of India (RBI) have introduced several significant changes to enhance the UPI experience. Here are seven notable updates:

1. Increased Transaction Limits for Specific Sectors

The RBI has raised the transaction limit for UPI payments related to hospitals and educational institutions from ₹1 lakh to ₹5 lakh. This adjustment aims to facilitate high-value transactions in critical sectors, ensuring that payments can be made swiftly and efficiently.

2. Introduction of Pre-Sanctioned Credit Lines

A new feature allows banks to link pre-approved credit lines to UPI. This means users can utilize their credit for UPI transactions, making it easier to manage larger purchases without immediate cash availability. This initiative promotes financial inclusion by providing more accessible credit options.

3. UPI for the Secondary Market

In a move to expand UPI’s utility, the NPCI has launched a beta version of ‘UPI for Secondary Market.’ This feature allows users to block funds post-trade confirmation and settle payments on a T1 basis, enhancing the efficiency of financial transactions in the stock market.

4. UPI ATMs Using QR Codes

UPI ATMs are being piloted, allowing users to withdraw cash using QR codes instead of physical debit cards. This innovation aims to enhance convenience and promote financial inclusion, particularly for those who may not have easy access to traditional banking services.

5. Four-Hour Cooling Period for Large Transactions

To improve security, the RBI has proposed a four-hour cooling period for first-time payments exceeding ₹2,000 to new recipients. This feature allows users to reverse or modify transactions, thereby reducing the risk of fraud.

6. Delegated Payments Feature

The RBI is set to introduce a “Delegated Payments” facility, allowing primary users to authorize family members or others to make UPI payments from their bank accounts. This feature is particularly beneficial in rural areas, where financial literacy may be lower, and multiple family members can share a single bank account for transactions.

7. Enhanced UPI Features: Hello UPI and UPI Lite X

The NPCI has introduced several innovative features, including Hello UPI, which allows users to make payments using voice commands, and UPI Lite X, enabling transactions without an internet connection through NFC technology. These enhancements aim to make UPI more accessible and user-friendly, particularly for those less comfortable with technology.

These changes reflect the ongoing efforts to enhance the UPI ecosystem, making it more secure, accessible, and user-friendly. As UPI continues to evolve, it is poised to play an even more significant role in India’s digital economy.