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UPI Circle is designed to empower users who may not have direct control over their finances but still require the ability to make digital payments.

The National Payments Corporation of India (NPCI) has introduced a new feature called "UPI Circle" aimed at expanding digital payments accessibility.

Approved during the UPI Steering Committee meeting on August 3, 2023, UPI Circle allows primary users to delegate payment responsibilities to trusted secondary users.

This feature is expected to assist those who depend on others to manage their finances.

What is UPI Circle?

UPI Circle is designed to empower users who may not have direct control over their finances but still require the ability to make digital payments.

Primary users can link their UPI accounts with secondary users, granting them the ability to make payments on their behalf.

This system allows for two types of delegation:

Full Delegation: The primary user gives the secondary user the authority to initiate and complete transactions within predefined spending limits.

The secondary user does not need further approval to complete these transactions.

Partial Delegation: The secondary user can initiate transactions, but the primary user must authenticate and finalise the payment using their UPI PIN.

This offers greater control over large transactions while still granting flexibility for routine payments.


Key guidelines for UPI Circle

To ensure a secure and smooth user experience, NPCI has laid out specific guidelines for UPI apps and Payment Service Providers (PSPs):

Independent user journey: Both primary and secondary users will experience separate user journeys on their chosen UPI apps, allowing them to maintain their preferences and control.

Mandatory security protocols: All secondary users will need to use either passcodes or biometric authentication (such as fingerprint or face recognition) to safeguard transactions.

Linking process: Primary users can link secondary users by scanning a QR code or entering the secondary user’s UPI ID.

This will then be followed by selecting the secondary user’s contact from the primary user’s phone.

In the future, only contact selection will be allowed, and manual entry of mobile numbers will be restricted to improve security.

Delegation Limits: A primary user can delegate payment authority to a maximum of five secondary users.

Meanwhile, a secondary user can only accept delegation from one primary user, ensuring clarity and preventing overlapping responsibilities.

Who can benefit from UPI Circle?

The UPI Circle feature is beneficial for individuals who are either unable or unwilling to manage their digital payments but still require access to financial services.

For example:

• Elderly family members who rely on younger relatives for financial management.


• Children or dependents who need access to funds for daily expenses.


• Household workers who need to make digital transactions but do not manage their own bank accounts.


 

This feature ensures that such individuals can easily conduct digital transactions without having to rely solely on cash.

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