Key Highlights:
- RBI proposes to increase UPI Lite’s offline transaction limit from Rs 200 to Rs 500, to encourage digital payment adoption.
- To enhance access, RBI is integrating NFC technology into offline UPI Lite transactions, to aid areas with limited connectivity.
- RBI is pioneering AI-driven conversational payments on UPI Lite, initially supporting Hindi and English, with plans to expand language support.
In a move aimed at expanding the adoption of digital payments and enhancing user convenience across the nation, the Reserve Bank of India (RBI) has proposed raising the transaction limits for UPI Lite. As of August 10, the RBI has suggested an increase in the per-transaction payment threshold for UPI Lite when used in offline mode, elevating it from Rs 200 to Rs 500.
Presently, in offline mode, the RBI has set a transaction cap of Rs 200 per individual transaction and an overall ceiling of Rs 2,000 for digital payments, encompassing both National Common Mobility Card (NCMC) and UPI Lite transactions.
Know: How to Set up a UPI Lite Account on Paytm?
The upcoming adjustment will see a hike in the one-time transaction cap to Rs 500 in offline mode. It’s important to note that the daily cumulative transaction limit will remain unchanged at Rs 2,000.
RBI Governor Shaktikanta Das, in his announcement following the monetary policy committee meeting, shared insights behind this move. He stated, “With the objective of harnessing the new technologies for enhancing digital payments experience for users it is proposed to… enhance the transaction limit of small value digital payments in offline mode to Rs 500 from Rs 200 within the overall limit of Rs 2,000 per payment instrument. These initiatives will further deepen the reach of digital payments in the country.”
The RBI MPC elaborated on the rationale for increasing the transaction limit, stating: “By removing the need for two-factor authentication for small value transactions, these channels enable faster, reliable, and contactless mode of payments for everyday small-value payments, transit payments, etc. Since then, there have been demands for enhancing these limits. To encourage wider adoption of this mode of payments and bring in more use cases into this mode, it is now proposed to increase the per transaction limit to Rs 500”
To further popularize UPI Lite, the RBI plans to introduce a new method for offline payments leveraging UPI Lite and Near Field Communication (NFC) technology. This advancement will enable the use of UPI Lite even in areas with limited or no internet connection.
Beyond this, the RBI has further plans to enhance UPI Lite. A notable upcoming feature is “Conversational Payments,” which will enable users to make payments by interacting with an AI-powered system. These interactions can occur on messaging or chat applications, thereby streamlining the payment process and making it more user-friendly.
Read more: RBI Unveils Enhanced UPI Capabilities
Initially, “Conversational Payments” will be available in Hindi and English. However, the RBI plans to include other Indian languages in the future. To ensure effective implementation of this new feature, the RBI will issue guidelines to the National Payments Corporation of India (NPCI). These initiatives underscore the RBI’s commitment to making digital payments easier and more accessible for everyone in the country.
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