The Reserve Bank of India (RBI) on December 8 announced the following changes in limits for UPI and recurring transactions:
UPI transaction limit is now ₹5 lakhs for medical and education services: “To encourage the use of UPI for medical and educational services, it is proposed to enhance the limit for payments to hospitals and educational institutions from ₹1 lakh to ₹5 lakhs per transaction,” the central bank noted.
The default transaction limit for UPI is ₹1 lakh except for a few categories like capital markets (broking, mutual funds, etc), credit card payment, loan re-payments, EMI, insurance, etc., where the transaction limit is ₹2 lakhs, and for UPI payments for Retail Direct Scheme and IPO subscriptions where the limit is ₹5 lakhs.
Increase in credit and debit card recurring transaction limit to ₹1 lakh for mutual fund, insurance, and credit card bill payments:
RBI’s regulations on recurring transactions, which went into effect on October 1, 2021, require customers to set up something called an e-mandate for recurring transactions such as subscriptions, monthly bill payments, etc. via credit and debit cards.
Currently, if the recurring transaction is above Rs 15,000, users will receive a request for authentication from the bank 24 hours before the transaction is processed.
“But in categories such as subscription to mutual funds, payment of insurance premium and credit card bill payments, where the transaction sizes are more than ₹15,000, a need to enhance the limit has been expressed as adoption has been lagging,” the central bank observed.
Hence, the central bank has proposed to exempt the requirement of authentication for transactions up to ₹1 lakh for subscription to mutual funds, payment of insurance premiums and payments of credit card bills.
“The number of e-mandates registered currently stands at 8.5 crores, processing nearly ₹2800 crores of transactions per month,” the central bank added.
Also Read
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- The Unintended Consequence Of RBI’s New Card Rules
- UPI Goes Live With Credit Lines, Voice Payments, Tap And Pay With NFC, And More
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