If you frequently use the Unified Payments Interface (UPI) for your transactions, there is some exciting news for you. The National Payments Corporation of India (NPCI), which manages UPI, has increased the transaction limit to Rs. 5 lakh for specific types of payments. This change applies exclusively to tax payments. As of September 15, 2024, you will be able to make UPI payments up to Rs. 5 lakh in a single transaction for tax-related purposes, hospitals, educational services, Initial Public Offerings (IPOs), and Government Securities (G Sec).
Previously, limits for UPI transactions were adjusted through circulars in December 2021 and December 2023. NPCI's latest circular emphasizes the growing preference for UPI and the need to raise transaction limits for specific categories.
The circular directs banks, payment service providers (PSPs), and UPI apps to implement the new limit for tax payments. It specifies that merchants classified under the MCC-9311 category must strictly adhere to the tax payments only and ensure that UPI payments are enabled for the new limit.
In a recent announcement on August 8, 2024, Reserve Bank of India (RBI) Governor Shaktikanta Das highlighted the enhancement of the UPI limit for tax payments, noting that the limit will be increased from Rs. 1 lakh to Rs. 5 lakh per transaction. This move is intended to simplify and ease UPI payments for consumers.
The introduction of 'Delegated Payments' in UPI is proposed. This feature will enable a primary user to set a transaction limit for a secondary user on their UPI account. This development aims to expand the adoption and use of digital payments nationwide. Further instructions will be provided soon.
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