RBI MPC: Raises UPI Lite limit to ₹10,000, UPI123 Pay for Feature Phone Users
To encourage wider adoption of UPI, RBI has increased the pre-transaction limit for feature phone users through UPI123 Pay to ₹10,000 from ₹5,000.
UPI 123PAY is an instant payment system for feature phone users who can use the Unified Payments Interface payment service in a safe and secure manner. Through UPI 123PAY, feature phone users can make transactions by calling an IVR (interactive voice response) number, using the app functionality in feature phones, using a missed call approach, and using a proximity sound-based system. This facility is now available in 12 languages.
RBI has also increased the per-transaction limit to ₹10,000 to widen the use cases. It said necessary instructions will be issued to NPCI shortly.
RBI had earlier set a limit of ₹500 per transaction and an overall limit of ₹2,000 per UPI Lite wallet with the facility of auto-replenishment. To widen the scope of usage of this product, it has now been decided to increase the UPI Lite wallet limit to ₹5,000 and the per-transaction limit to ₹1,000.
The framework for facilitating small value payments in offline digital mode under which UPI Lite has been enabled, will be suitably amended, said RBI.
Dilip Modi, Founder and CEO of Spice Money, said the development will further democratise digital payments, drive financial empowerment in regions that have historically been underserved by traditional banking infrastructure, and promote safe transactions across the country.
This announcement by the RBI also signals that digital payments will continue to play a central role in the financial ecosystem. It will not only boost adoption but also foster greater confidence in digital payments, helping to accelerate the transition to a cashless economy, he said.
Yashwant Lodha, Co-Founder of PayNearby, said the changes in UPI payment solutions will broaden access, encourage greater adoption, and ultimately fuel consumption, contributing to the overall growth of the Indian economy.
To truly drive financial inclusion, it is essential to make digital payments more accessible through continuous innovation, he added.
Rahul Jain, CFO of NTT Data Payment Services India, said under-served categories, such as senior citizens and users from rural India with limited digital usage, might find this beneficial. It can be particularly useful for making utility bill payments and payments to other users.
The move from the RBI comes after the SEBI’s directive to allow a UPI-based block mechanism for funding secondary market trades in the capital market, which augurs well for both consumers and the industry as payments become more efficient and convenient.