The Reserve Bank of India has announced that it is increasing the transaction limit for UPI Lite limit for users from Rs.200 to Rs.500.Users will now be able to pay up to Rs.500 without the requirement of entering a PIN.
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RBI Governor Shaktikanta Das took the decision to raise the transaction limit during the central bank’s bi-monthly policy review meeting. This move will help with the promotion of UPI Lite transactions and increase its adoption rate.
What Is UPI Lite?
UPI Lite is a toned-down and simplified version of the traditional Unified Payments Interface. It was introduced by the National Payments Corporation of India (NCPI) in collaboration with the RBI. It functions similarly to a wallet, as users can load up to Rs.2,000 daily and make instant transactions of Rs.500 each using this new UPI lite limit increase. Making transactions on UPI-Lite does not require a PIN.
The on-device limit for UPI-Lite will still remain at Rs.2,000. This is most likely to negate the risk of conducting transactions without entering a PIN.
How Does It Work?
The aim behind UPI-Lite was to create an alternative to the traditional UPI system. It allows users to make regular transactions seamlessly without the need to worry about typical network or processing failures. Since it does not require a PIN, users can load money from their bank account using the UPI-Lite-supported application and then use these funds to make payments.
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After downloading a UPI Lite-enabled application, users will need to create a UPI Lite ID and then load money into their wallet. The central bank has also announced the integration of UPI Lite with NFC (Near Field Connectivity). This will allow consumers living in areas with low or no connectivity to make seamless transactions. To make NFC payments, users need to tap their smartphones on a POS (Point of Sale) device, and the amount is automatically transferred to the recipient.
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RBI has said that it is also working on conversational payments for UPI to allow users to make payments through AI-powered systems. This will make the payment process more convenient and accessible. Users can make payments through online messaging or chatting apps. This feature will be initially available in Hindi and English, with the availability of regional languages expected in the future.
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Abeer Chawake
Abeer is a tech enthusiast who keeps track of all the trending gadgets and smartphones. During his free time, he can be found playing the latest PC games or binge watching TV shows.