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Synopsis: The National Payments Corporation of India (NPCI) has raised the UPI transaction limit to ₹5 lakh for high-value payments in sectors like tax, healthcare, education, and financial investments. This increase, effective from September 16, 2024, is intended to simplify larger transactions, up from the previous ₹1 lakh limit. The higher limit is specifically for verified merchants in these sectors, while peer-to-peer transfers continue to have a ₹1 lakh cap |
The National Payments Corporation of India (NPCI) has officially raised the upper limit for Unified Payments Interface (UPI) transactions to ₹5 lakh per transaction for specific high-value categories, effective from September 16, 2024. This is a significant leap from the previous limit of ₹1 lakh and is aimed at making digital payments even more accessible and versatile for larger transactions in key sectors like tax payments, healthcare, education, and financial investments.
What Does the New Limit Apply To?
The increased UPI transaction limit is applicable primarily to sectors that frequently deal with high-value transactions. These include:
- Tax Payments: Users can now pay up to ₹5 lakh per transaction to the government for tax obligations.
- Healthcare: Hospitals and medical institutions that are verified merchants will now accept UPI payments up to ₹5 lakh, simplifying large medical bill payments.
- Educational Fees: Educational institutions, another sector with high-ticket transactions, are now included in this raised limit.
- Financial Investments: Payments for Initial Public Offerings (IPOs), government securities (G-Secs), and certain other financial instruments will also be covered under this new limit.
Why the Increase in UPI Transaction Limit?
According to the Reserve Bank of India (RBI), this change aligns with efforts to promote digital transactions across a wider spectrum of financial activities. Previously, high-value payments were often relegated to net banking or other more traditional channels, but with this update, UPI will cater to a broader range of payment needs.
What Remains Unchanged?
While the ₹5 lakh cap applies to high-value categories, the UPI limit for peer-to-peer transfers and other standard transactions remains at ₹1 lakh. This means everyday users sending money to family or friends won’t see a change in their transaction limits. Additionally, categories like international inward remittances, capital markets, and insurance payments continue to have a daily cap of ₹2 lakh.
What Should Users Keep in Mind?
Although the new limit is effective immediately, users are advised to check with their respective banks and UPI apps to confirm their support for the increased transaction limit. Not all banks may implement the change uniformly, and some, like Allahabad Bank, continue to have lower transaction caps, such as ₹25,000 for UPI payments.
In conclusion, the new ₹5 lakh UPI transaction limit is a game-changer for industries that handle larger payments regularly, providing both convenience and efficiency to users across the country.
