The Reserve Bank of India (RBI) has announced an increase in the wallet limit for UPI Lite from Rs 2,000 to Rs 5,000. This change aims to promote the use of the instant payment system through mobile phones.
Additionally, the transaction limit per use has also been raised from Rs 500 to Rs 1,000. Now, users can send a maximum of Rs 1,000 in one transaction using UPI Lite.
According to an RBI circular, the new limits are: “The increased limit for UPI Lite will be Rs 1,000 per transaction, and the total limit at any time will be Rs 5,000.”
Features of UPI Lite
UPI Lite offers a user-friendly way to make low-value transactions without needing a UPI PIN. This is especially convenient for smartphone users.
Unlike regular UPI, which requires a UPI PIN and relies on the bank’s core banking system, UPI Lite works offline. It supports various types of transactions, including person-to-person, person-to-merchant,
and small merchant payments. However, while UPI Lite allows offline debit for payments, users still need to be online for credits.
Most UPI merchant transactions use QR codes (static or dynamic) for payments, which require an online connection to complete the transaction.
The RBI’s decision to increase these limits aligns with its ongoing efforts to improve digital payment technologies, especially in areas with limited or no internet connectivity.
RBI’s Plans for UPI Lite
In October, the RBI had discussed the possibility of adjusting the UPI payment limits as part of its monetary policy. In its statement on developmental
and regulatory policies, the RBI mentioned that the framework for facilitating small-value payments in offline digital mode, under which UPI Lite operates, would be “suitably modified” in the future.