RBI Announces Revised UPI Transaction Limits and Rule Changes

In a significant move, Shaktikanta Das, the Governor of the Reserve Bank of India (RBI), unveiled changes to the Unified Payments Interface (UPI), introducing altered transaction limits and rule adjustments for the online payments ecosystem. The announcement was made during the bi-monthly Monetary Policy Committee (MPC) meeting.

Enhanced UPI Transaction Limits for Specific Categories

Governor Das revealed that the UPI transaction limits would be revised, particularly for hospital and education payments. The current limit of ₹1 lakh is set to be increased to ₹5 lakh. This adjustment aims to encourage the use of UPI for substantial transactions related to hospitals and educational institutions.

“The limit for various categories of UPI transactions has been reviewed from time to time. It is now proposed to enhance the UPI transaction limit for payment to hospitals and educational institutions from the current ₹1 lakh to ₹5 lakh,” stated Governor Shaktikanta Das. Separate instructions regarding the implementation of these new limits will be issued shortly.

E-Mandate Limits for Recurring Payments Raised

In addition to UPI transaction limits, the RBI proposed an increase in the e-mandate limit for recurring payments. The limit is set to be raised from the current ₹15,000 to ₹1 lakh for categories such as mutual funds, insurance premiums, and credit card payments. This adjustment aims to accommodate larger transaction sizes in these categories and foster increased adoption.

“E-mandates for making payments of a recurring nature have become popular among customers. It is now proposed to enhance this limit to ₹1 lakh per transaction for recurring payments of mutual fund subscriptions, insurance premium subscriptions, and credit card repayments,” explained Governor Das. The current number of e-mandates stands at 85 million, processing nearly ₹2,800 crore of transactions per month.

Industry Reactions and Outlook

Industry experts and leaders in the financial sector welcomed these changes, emphasizing the positive impact on the payment ecosystem. The head of the Bank Recovery Agent of All India Bank highlighted the progressive nature of the move, anticipating further advancements in the system.

Adhil Shetty, CEO of BankBazaar.com, noted the critical role of the increased UPI payment limit for education and hospital payments. He emphasized that the adjustment would facilitate secure and seamless payment experiences for users relying on UPI in critical sectors.

Aryanman Vir, CEO of WiseX, hailed the move as a significant step towards financial inclusivity. The increased UPI transaction limit for payments to hospitals and educational institutions is seen as a tool for inclusive economic development.

Conclusion: Ushering in a New Era of Financial Transactions

The RBI’s announcement reflects a strategic decision to adapt to evolving financial needs and encourage the digital transformation of payment methods. These changes hold the potential to bring about a transformative impact, particularly in the context of healthcare and education payments. As the financial landscape continues to evolve, such regulatory adjustments play a crucial role in fostering a secure and seamless digital payment ecosystem.

Sources: Various News Agencies

By Sanjana Shelar, Mumbai, reporting for True to Life