NPCI to Determine Cap on Merchant Payments via UPI: RBI
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Synopsis
The NPCI will have the authority to set limits on person-to-merchant UPI transactions, allowing for adjustments based on evolving user needs. This initiative is designed to enhance digital payments in India, as confirmed by RBI Governor Sanjay Malhotra.
Key Takeaways
- NPCI to set limits on UPI merchant payments.
- Current UPI cap at Rs 1 lakh for P2P transactions.
- March saw UPI transactions worth Rs 24.77 lakh crore.
- Daily transactions average Rs 79,910 crore.
- Significant growth in digital payments continues.
New Delhi, April 9 (NationPress) To further enhance digital payments, the National Payments Corporation of India will be authorized to establish limits on transactions from individuals to merchants through the Unified Payments Interface (UPI), as stated by RBI Governor Sanjay Malhotra on Wednesday.
Currently, the cap on UPI transactions, which includes both person-to-person (P2P) and person-to-merchant (P2M) payments, is set at Rs 1 lakh, with certain P2M scenarios having elevated limits of Rs 2 lakh and Rs 5 lakh.
“To facilitate the ecosystem's response to emerging use cases, it is proposed that NPCI, in collaboration with banks and other stakeholders in the UPI ecosystem, may announce and modify these limits based on changing user requirements,” remarked Malhotra following the 54th meeting of the monetary policy committee (MPC).
Robust safeguards will be implemented to address risks associated with increased limits. Banks will retain the authority to determine their own internal limits within those set by NPCI.
“P2P transactions on UPI will remain capped at Rs 1 lakh, as previously established. NPCI will be informed accordingly,” as per the Central Bank.
The payment systems operator will make decisions in consultation with banks and other stakeholders, the RBI chief mentioned during the monetary policy announcement.
Meanwhile, the UPI network experienced a 13.59 percent month-on-month increase in transaction volume, reaching 18.3 billion in March, compared to 16.11 billion in February.
March recorded an impressive Rs 24.77 lakh crore in UPI-based transactions, representing a 12.79 percent increase from Rs 21.96 lakh crore in February, according to NPCI data.
On a daily basis, the UPI framework saw more than 590 million transactions on average, totaling Rs 79,910 crore in daily transaction value.
Year-on-year, the record UPI transactions of Rs 24.77 lakh crore in March indicated a 25 percent increase in value and a remarkable 36 percent rise in volume, showcasing the unstoppable momentum of India's digital payments revolution.
With daily transactions averaging Rs 79,910 crore, reflecting a 1.9 percent increase from February, and transaction volumes climbing 2.6 percent, these figures highlight the swift adoption and growing trust in digital financial solutions.
