India’s UPI Revolution: New Rules, Higher Limits, and Financial Inclusion in 2024

India's UPI Revolution: New Rules, Higher Limits, and Financial Inclusion in 2024

VoM News Desk | January 13, 2024 | 10:14 AM IST | Technology | Follow on Google News

India’s UPI Revolution: New Rules, Higher Limits, and Financial Inclusion in 2024

India’s UPI Revolution: New Rules, Higher Limits, and Financial Inclusion in 2024

Unified Payments Interface (UPI) continues to shape India’s digital payments landscape, offering enhanced convenience, inclusivity, and secure transactions. As we step into 2024, Mehul Mistry, Global Head-Strategy at Wibmo, a PayU Company, predicts a 60% growth in UPI transactions volume, with peer-to-merchant (P2M) transactions surpassing peer-to-peer (P2P) transactions, constituting 60% of the total UPI volume.

Several key changes in UPI rules are set to impact users positively:

1. Increased Transaction Limits for Critical Sectors:

• Hospitals and educational institutions can now process high-value payments up to ₹5 lakh, up from the earlier ₹1 lakh limit.
• This move facilitates real-time payments and instant settlements, benefiting consumers and merchants in these sectors.

1. Pre-sanctioned Credit Line on UPI:

• UPI introduces pre-sanctioned credit lines, providing easier access to loans for individuals and businesses, contributing to financial inclusion.

1. UPI for Secondary Market:

• The NPCI initiates ‘UPI for Secondary Market’ in its Beta phase, streamlining trading settlements and offering faster transactions through Clearing Corporations.

1. UPI ATMs Using QR Codes:

• UPI ATMs employing QR codes, currently in the pilot phase, enable cash withdrawals without physical debit cards, enhancing convenience and financial inclusion.

1. Four-hour Cooling Period:

• RBI proposes a four-hour cooling period for users initiating first payments exceeding ₹2,000 to new recipients, enhancing transaction safety by allowing users to reverse or modify transactions within this timeframe.

Additionally, in 2023, UPI integration with credit systems marked a significant step towards financial inclusion. The introduction of features like ‘single-block-and-multiple-debits’ simplifies transactions, while extending UPI services to feature phones significantly increases financial inclusivity. The NPCI’s directive to deactivate inactive UPI IDs after one year underscores the need for users to verify and ensure the continued activity of their UPI IDs.

These changes collectively aim to streamline, secure, and expand UPI services in India’s dynamic digital payment landscape.

Source: Adapted from Hindustan Times article

VoM News Desk

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