UPI Transaction Limit Changing From Sept 16; Check Eligibility And New Transaction Limit For Various Payments

UPI Transaction Limit: The new UPI limit will also apply to other transactions, including payments to hospitals, educational institutions, IPOs, and RBI retail direct schemes.

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UPI Transaction Limit: The National Payments Corporation of India (NPCI) has increased the transaction limit for tax payments using UPI to help millions of taxpayers in the country. Now, individuals will be able to use the Unified Payments Interface (UPI) to pay taxes up to Rs 5 lakh per transaction from tomorrow Sept 16. 

Alignment With RBI Policy 

This decision aligns with the Reserve Bank of India’s (RBI) monetary policy statement on August 8, 2024, which raised the UPI transaction limit for tax payments. This increase aims to make large transactions more convenient for taxpayers. The decision aims to simplify the tax payment process and encourage more people to use UPI for higher-value transactions. 

UPI Transactions With Rs 5 Lakh Upper Limit: Eligible Transaction Types

Notably, the new UPI limit will also apply to other transactions, including payments to hospitals, educational institutions, IPOs, and RBI retail direct schemes. Hence, the banks and UPI apps must be checked for compatibility with the new limits. 

It is important to note that this increased limit is only applicable to certain transactions, and users should verify with their bank and UPI app to ensure they support this feature. 

NPCI Urges Banks, Payment Service Providers  

Meanwhile, the NPCI has asked all the members — banks, payment service providers and UPI apps to ensure compliance with the increase in tax payment transaction limit for the MCC 9311 category of verified merchants by September 15, 2024. 

Previous Changes To UPI Limits

The NPCI revised UPI transaction limits in both December 2021 and December 2023, highlighting its continuous efforts to broaden UPI usage across different sectors, including tax payments.

Introduction Of UPI Circle Feature 

The new feature, "UPI Circle," enables primary UPI account holders to delegate transactions to trusted individuals, improving both security and convenience.

UPI Transaction Limits For Various Payments: 

The standard UPI transaction limit for peer-to-peer payments is Rs 1 lakh. However, individual banks can set their own UPI limits. For example, Allahabad Bank has a UPI transaction limit of Rs 25,000, as per Google Pay's UPI bank-wise limits.

In contrast, banks like HDFC and ICICI allow transactions up to Rs 1 lakh. Adding further, UPI apps may have their own transaction limits, which can vary across platforms.

There are other transaction limits for different types of UPI transactions. UPI transactions related to capital markets, collections, insurance, and foreign inward remittances have a limit of Rs 2 Lakh per day.