RBI rolls out regulations on UPI payments; effective from Jan 1
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New Delhi: The Reserve Bank of India (RBI) has announced certain measures and changes to the Unified Payments Interface (UPI) to enhance the scope of the payment system. The said changes will be effective from January 1, 2024, NDTV reported.
The National Payments Corporation of India (NPCI) has instructed UPI payment apps, including Google Pay, Paytm, and PhonePe, as well as banks, to deactivate UPI IDs and numbers that have been inactive for more than a year. Also, the daily payment limit through UPI has been limited to 1 lakh rupees, though RBI raised UPI payments to hospitals and educational institutions to ₹ 5 lakh on December 8, 2023.
Further, a 1.1 per cent interchange fee has been imposed on certain merchant UPI p transactions above Rs 2,000, which are done through prepaid payment instruments (PPI) like online wallets.
Then, a four-hour time limit was added to payments exceeding Rs 2,000 to other users with whom they have not previously transacted. This is to check online payment fraud.
Soon, UPI members will be allowed to go live with the UPI' Tap and Pay' functionality.
RBI has plans to open UPI ATMs all across India in collaboration with Japanese firm Hitachi. These ATMs will allow people to scan a QR code and withdraw cash from bank accounts.
Unified Payments Interface (UPI) in India allows users to make instant money transactions, even between different banks, using their smartphones.
UPI crossed 10 billion transactions in August 2023, and an NPCI official claimed that India has the potential to do 100 billion UPI transactions in a month.