Major UPI Changes: UPI, or Unified Payment Interface, has been traveling the world since 2021 and has seen a lot of dynamic changes in recent years. In August last year, UPI recorded over 10 billion transactions, which is approx. 2 billion more than the entire global population, transforming the landscape of digital payments.

Who would have ever thought that it could position India as a leader in real-time payment transactions worldwide, attracting around 260 million users so far!

Regulated by the RBI and developed by the National Payments Corporation of India (NPCI), UPI allows users to link multiple bank accounts in one application, combining various banking features for easy fund transfers and merchant payments.

To make UPI even more user-friendly for every Indian, the government is rolling out some changes from the beginning of this year. So, keep reading to keep yourself updated, find those 5 major changes in UPI, and how they can make your everyday life easier!

5 Major UPI Changes

1.  Inactive UPI IDs

Ever wondered what happens if you forget about your UPI ID for a year or more? 

Well, the National Payments Corporation of India (NPCI) has directed banks and all the online payment apps like PhonePe, Google Pay, Paytm, and similar platforms, as well as banks, to deactivate all the UPI IDs left inactive for the last 12 months. 

So, if you’ve got a UPI ID that you haven’t used in a very long time, it’s high time to use it for at least one payment soon to keep it active and avoid getting deactivated.

This move is essentially to prevent unused accounts and potential misuse.

2. Increased transaction limit

The RBI has recently set a new maximum daily payment limit for UPI transactions. From now on, the limit for hospitals and educational institutions is Rs. 5 lakh, a significant jump from the previous Rs. 1 lakh.

This will make it convenient for customers and simplify huge payments to such institutions to complete their transactions.

But wait, there’s more: for regular payments like credit card repayment, mutual fund subscriptions, and insurance premium payments, the transaction limit has been increased from Rs. 15,000 to Rs. 1 lakh.

3. Pilot Project for ‘UPI for Secondary Market’

Recently, NPCI has revealed plans for the upcoming launch of ‘UPI for Secondary Market’ in its Beta Phase, approved by the SEBI and set to commence in the first week of January.

In simpler terms, investors can block funds in their bank accounts during this pilot project. These funds will only be debited by the Clearing Corporations upon trade confirmation during settlement. Here, Clearing Corporations will process payouts directly to the clients on a T+1 basis.

So now, you don’t have to transfer the funds to your stockbroker account; instead, you can directly block funds in your bank account for placing trades.

However, it is important to note that this is currently limited to the equity cash segment and available to a limited set of pilot customers.

4. Cash Withdrawal by using a QR Code

NPCI and Hitachi Payment Services have teamed up to introduce India’s first UPI-ATM. This means you can now withdraw cash by just scanning a QR code. The RBI is planning a nationwide rollout of UPI ATMs.

5. Fraud Prevention by a 4-hour window for first payments

To reduce the rising cases of online payment fraud, a new plan is in place. Every time a user initiates the first payment of over Rs. 2,000 to someone they have yet to transact with before, they will have a 4-hour time limit. This means the user will have four hours to modify or reverse payments to a first-time user.

Written By Shivani Singh

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