New Delhi, April 9
In order to further boost digital payments, the National Payments Corporation of India will be enabled to set the limit on person-to-merchants transactions via Unified Payments Interface (UPI), RBI Governor Sanjay Malhotra said on Wednesday.
At present, the transaction amount for UPI, covering both person-to-person (P2P) and person-to-merchant payments (P2M), is capped at Rs 1 lakh, except for specific use cases of P2M payments which have higher limits, some at Rs 2 lakh and others at Rs 5 lakh.
“To enable the ecosystem to respond efficiently to new use cases, it is proposed that NPCI, in consultation with banks and other stakeholders of the UPI ecosystem, may announce and revise such limits based on evolving user needs,” said Malhotra after the 54th meeting of the monetary policy committee (MPC).
Appropriate safeguards will be put in place to mitigate risks associated with higher limits. Banks shall continue to have the discretion to decide their own internal limits within the limits announced by NPCI.
“P2P transactions on UPI shall continue to be capped at Rs 1 lakh, as hitherto. NPCI will be advised accordingly,” according to the Central Bank.
The payment systems operator will take the decision in consultation with banks and other shareholders, the RBI chief said during the monetary policy announcement.