The popular Unified Payments Interface (UPI) in India is undergoing some significant changes, with new rules set to be effective from January 1, 2024, as announced by the Reserve Bank of India (RBI). Here are the key updates you need to be aware of:
- UPI ATMs Across India: Starting January 1, 2024, UPI ATMs will be introduced nationwide. These ATMs allow you to withdraw cash directly from your bank account by scanning a QR code.
- Four-Hour Time Limit for First Payments Above Rs 2,000: A new four-hour time restriction will apply to the first payment above Rs 2,000 between customers who haven’t transacted before. This measure aims to reduce online payment fraud. UPI members will soon benefit from the “Tap and Pay” feature.
- Interchange Fees for Merchant UPI Transactions: A 1.1 percent interchange fee will be levied on specific merchant UPI transactions exceeding Rs 2,000, which are made using prepaid payment instruments (PPI) like online wallets.
- Increased Daily Transaction Limits: The National Payments Corporation of India (NPCI) has raised the maximum daily payment limit for UPI transactions to Rs 1 lakh. Notably, healthcare and educational institutions saw an increase to Rs 5 lakh on December 8, 2023. The previous limit was Rs 1 lakh.
- Deactivation of Inactive UPI: The NPCI has instructed payment applications like Paytm, Google Pay, PhonePe, and banks to deactivate UPI IDs and numbers that haven’t been used for over a year. If a UPI ID or associated mobile number remains inactive for more than a year, they will be terminated to prevent unused accounts.
Stay informed about these changes to ensure a smooth experience with UPI payments in the coming year.