The National Payments Corporation of India (NPCI) has announced a set of updates to UPI rules to better accommodate rising demand for high-value digital payments. As UPI becomes the go-to method for everyday transfers, loans, insurance payments, and investments, the authority has adjusted limits to make large, legitimate transactions easier while aiming to curb fraud. Here’s what changes and what they might mean for you.
What exactly changed
Under the new rules, the UPI transaction limit that previously stood at Rs 1 lakh has been increased to Rs 5 lakh. In addition, the daily cap on UPI transactions has been raised to Rs 10 lakh. These enhancements are designed primarily to apply to person-to-merchant (P2M) transfers and to verified merchants and larger institutions that regularly process higher-value payments.
Who benefits from the new limits
The changes are aimed at expanding the use of UPI for high-value digital payments that were previously carried out through alternative channels. For Indian customers, this includes payments related to insurance premiums, loans, EMI installments, travel bookings, and certain capital market investments. The higher ceiling makes it simpler to settle sizable payments directly via UPI without resorting to cash or card-based methods.
New limits by category
General transfers and merchant payments
For regular high-value transfers and payments to verified merchants, the upper limit has risen from Rs 1 lakh to Rs 5 lakh per transaction, with a daily cap now set at Rs 10 lakh. This is particularly relevant for businesses that routinely collect payments through UPI, as well as consumers paying for bulk or recurring services.
Insurance, loans, travel, and capital market investments
In a move that should help streamline financial planning, the limit for insurance payments, loan settlements, travel-related expenses, and certain capital market investments has been raised from Rs 5 lakh to Rs 10 lakh. This expansion reflects the growing demand for digital handling of substantial financial commitments via a single, convenient platform.
Credit card bill payments
Credit card bill payments made via UPI have also seen an increase, with the limit rising up to Rs 6 lakh per payment. This change acknowledges the rising size of outstanding card bills and offers a smoother, more secure way to settle them digitally.
Why these changes are being made
NPCI notes that UPI has become India’s most favored payment method, with a continual rise in high-value digital transactions. To support this growing demand while improving user convenience, the organization has opted to raise the thresholds. The intent is to make high-value payments easier, faster, and safer for both individuals and institutions, all while maintaining strong controls against fraud and misuse.
How to use the new limits
Users and merchants should continue to follow standard UPI workflows: select the UPI option in your banking app, enter the recipient details, input the amount within the updated limit, and authorize the transaction via your preferred authentication method. For merchants, ensure you are verified by your bank to benefit from the higher limit and the associated convenience. Always confirm the recipient and the amount before authorizing, as high-value transfers can be irreversible once completed.
Practical tips for users
- Plan ahead for large payments and confirm the updated limits with your bank if you expect to transact near the new caps.
- Use auto-pay or scheduled payments where appropriate to manage EMIs and recurring charges efficiently.
- Stay vigilant against phishing or fraudulent requests, especially for high-value transactions. always verify the payee details within the app.
- If you frequently hit the new limits, consider splitting payments across multiple days or leveraging other digital channels securely, as advised by your bank.
Potential considerations
While higher limits improve convenience, they also necessitate heightened awareness of security. Customers should ensure their devices have updated security features, enable device-level authentication, and monitor bank notifications for any unrecognized activity. Banks and NPCI emphasize continued commitment to fraud prevention and risk management alongside these expanded thresholds.
Bottom line
The UPI limit enhancements reflect a broader push to mainstream high-value digital payments in India. By increasing the per-transaction cap to Rs 5 lakh and the daily cap to Rs 10 lakh for P2M and verified merchants, and by lifting specific category ceilings to Rs 10 lakh (insurance, loans, travel, capital markets) and Rs 6 lakh (credit card bills), NPCI is enabling more seamless, cost-efficient digital transactions while aiming to maintain robust safeguards against misuse.
