NPCI Increases UPI Transaction Limits To Rs 5 Lakh For Key Categories — Check Details

The National Payments Corp. has raised the Unified Payments Interface transaction limit to Rs 5 lakh for several categories, a move aimed at accommodating the growing demand for higher-value digital payments.

The new limits, which take effect on Sept. 15, apply to various sectors including capital markets, insurance and travel. The decision was formalised in an NPCI circular dated Aug. 28, which cited market demand for increased per-transaction limits as UPI cements its position as a dominant payment method.

This change is particularly significant for merchants handling larger transactions, such as those in capital markets or insurance, where a Rs 5-lakh limit can stymie major payments.

The enhanced limits are exclusively for verified merchants who comply with NPCI's guidelines. The circular mandates that member banks, which acquire merchants, are responsible for ensuring that these higher limits are only offered to compliant businesses.

While the NPCI has set the new ceiling, it has also provided flexibility to member banks. Banks can still set their own internal transaction limits based on their specific policies, as long as they do not exceed the new maximums.

The Rs 5 lakh transaction limit now applies to a broad range of categories, including:

• Capital Markets

• Insurance

• Government e-Marketplace

• Travel

• Credit Card Bill Payments

• Collections

• Business/Merchants (including pre-approved payments)

• FX retail use cases (with the BBPS platform)

• Digital Account Opening (for term deposits)

For two specific categories, the limit has been set at Rs 2 lakh:

• Jewellery

• Digital Account Opening - Initial Funding

All UPI apps and payment service providers have been instructed to make the necessary system changes to comply with the new guidelines by Sept. 15.