This move from the RBI allows individuals to do larger transactions using UPI, potentially facilitating smoother and substantial payments in crucial sectors.
New Delhi: The Reserve Bank of India (RBI) on Friday announced to hike the limits for UPI auto payments for specified transactions without additional factor authentication (AFA). According to the RBI’ announcement, no one-time password (OTP) based authentication will be required for payments made up to Rs 1 lakh. The RBI said the new limit will be applicable for mutual fund subscriptions, insurance premium subscriptions and credit card repayments only.
UPI Payment Limit Hiked
The RBI further added that the limit for payments made to hospitals and educational institutions through UPI apps has been increased to Rs 5 lakh from Rs 1 lakh per transaction. This move from the RBI allows individuals to do larger transactions using UPI, potentially facilitating smoother and substantial payments in crucial sectors.
RBI Governor Shaktikanta Das announced an increase in the limit that triggers additional factor authentication for e-mandates in certain recurring online transactions. E-mandates involve instructions to the bank for automatic debits from an account for recurring payments.
Right now, if you initiate an e-mandate, you require an additional factor authentication (one OPT on email and another on mobile) for transactions beyond Rs 15,000. This limit has now been raised to Rs 1 lakh for recurring online payments relating to mutual fund SIPs (systematic investment plans), insurance premiums and credit card repayments. The RBI says this will accelerate the use of e-mandates.
Check UPI Transaction Rules
As per the new UPI transaction limit rules, individuals can make payments through UPI up to Rs 5 lakh instead of the earlier Rs 1 lakh for specific payments.
“The limit for various categories of UPI transactions has been reviewed from time to time. It is now proposed to enhance the UPI transaction limit for payment to hospitals and educational institutions from Rs 1 lakh to Rs 5 lakh per transaction,” the RBI governor said. “This will help the consumers to make UPI payments of higher amounts for education and healthcare purposes,” he added.
E-mandate For Recurring Payments: Check New Rules
The RBI has made e-mandates compulsory for making payments which are recurring in nature. The current limit above which additional factor authentication is required is Rs 15,000. This limit has now been increased to Rs 1 lakh for mutual funds subscriptions, insurance premium subscriptions and credit card repayments.
“e-Mandates for making payments of recurring nature have become popular among customers,” the central bank governor notes. Under this framework, an additional factor of authentication (AFA) is currently required for recurring transactions exceeding Rs 15,000. “It is now proposed to enhance this limit to Rs 1 lakh per transaction for recurring payments of mutual fund subscriptions, insurance premium subscriptions and credit card repayments,” he said in his statement. “This measure will further accelerate the usage of e-mandates,” he added.