UPI Lite and small payments: New auto top-up features, limits effective November 1

From November 1, 2024 onwards, managing your UPI Lite balance will become more convenient with a new auto top-up feature. This enhancement, implemented by the National Payments Corporation of India (NPCI), will automatically replenish your UPI Lite account when the balance falls below a specified threshold to ensure a smooth payment process.

Moreover, the Reserve Bank of India (RBI) has increased the transaction limit for UPI Lite, which is anticipated to be launched shortly.

The auto top-up feature enables users to establish a predefined balance threshold. When the account balance falls below this threshold, it will automatically be replenished with a selected amount specified by the user. This feature facilitates swift and secure transactions without the need for a PIN for payments under Rs 500.

The UPI Lite account will automatically replenish when it drops below the selected minimum balance. Users can establish an auto top-up mandate through their UPI app, granting permission for funds to be taken from their bank account and added to their UPI Lite balance as needed. Users have the ability to revoke the mandate at any time, maintaining control over their account. 

Additionally, auto top-ups are limited to five transactions per day to supervise usage. UPI Lite is designed for swift transactions, eliminating the requirement for PIN verification for amounts under Rs 500. Users can easily conduct payments via their UPI app without involving the bank's main systems.

In order to encourage greater usage, the Reserve Bank of India has recently declared expanded UPI Lite limits:

The transaction limit per UPI Lite transaction will be raised from Rs 500 to Rs 1,000.
The maximum balance permitted in a UPI Lite wallet will be increased from Rs 2,000 to Rs 5,000. Despite these changes, the daily transaction limit will remain at Rs 4,000.

UPI's new record in October 2024

In October, there were a record-breaking 16.58 billion Unified Payments Interface (UPI) transactions totaling Rs 23.5 trillion, marking the highest numbers since the system's inception in April 2016. This surpassed the previous peak of 15.04 billion transactions in September 2024 and Rs 20.64 trillion in July. The growth in transactions has been primarily driven by person-to-merchant transactions, particularly during the festive season in October.

This milestone marked the first time UPI exceeded 16 billion in volume and Rs 23 trillion in value. Compared to September, there was a 10% increase in volume and a 14% increase in value. Data from the National Payments Corporation of India (NPCI) shows that in August, there were 14.96 billion UPI transactions amounting to Rs 20.61 trillion.

In October, the volume of daily UPI transactions exceeded 535 million, with a total value of Rs 75,801 crore. This is a significant increase compared to the 501 million transactions and Rs 68,800 crore value recorded in September. Year-on-year, there was a growth of 45% in transaction volume and 37% in transaction value during October.