HIGHLIGHTS
- RBI issued certain policies and modifications to expand the reach of UPI transactions, which took effect from January 1, 2024.
- This covers raising transaction limits, deactivating unused UPI IDs and connected cell numbers, and using QR codes to withdraw cash.
- Read the article to know more.
The Unified Payments Interface is currently one of the most widely used payment methods in the country (UPI). Since its inception, digital transactions have increased significantly in India. To further enhance UPI payments, the Reserve Bank of India (RBI) has decided on new rules and modifications that would go into effect from January 1, 2024.
A number of important legislation and regulations regarding UPI transactions were established, and they went into effect from January 1, 2024.
UPI ATM: The RBI intends to install UPI ATMs all around the nation. By scanning a QR code, these ATMs let you withdraw cash directly from your bank account.
Four-hour time limit: In an attempt to reduce the growing number of instances of online payment fraud, there will be a four-hour time limit on the first payment over Rs 2,000 made between consumers who have never transacted before. Soon, UPI members will be able to utilize the “Tap and Pay” feature.
Exchange fees: For specific merchant UPI transactions over Rs 2,000 that are conducted using prepaid payment instruments (PPI), such as online wallets, an interchange fee of 1.1 percent would be assessed.
Increased transaction limits: The NPCI has set a new maximum daily payment limit of Rs 1 lakh for UPI transactions. However, the RBI increased the UPI transaction limit for healthcare and educational institutions to Rs 5 lakh on December 8. One lakh rupees was the transaction limit in the past.
Deactivation of inactive UPI: The National Payments Corporation of India (NPCI) has asked payment apps like Paytm, Google Pay, PhonePe, and banks to deactivate UPI IDs and phones that haven’t been used in more than a year. A UPI ID and accompanying mobile phone will be canceled after more than a year of inactivity. This is an effort to stop accounts from being underutilized.
