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UPI 123Pay Payment Limit Doubled: New Rule Effective from January 1, 2025
Indiaemploymentnews | November 26, 2024 3:39 AM CST

The Reserve Bank of India (RBI) has introduced a major update for feature phone users who rely on UPI 123Pay for digital payments. Starting January 1, 2025, the payment limit for UPI 123Pay transactions will increase from ₹5,000 to ₹10,000. This move aims to make digital payments more accessible for India's 400 million feature phone users.

Key Highlights of the Update

  • Increased Payment Limit

    • The maximum transaction amount via UPI 123Pay has been doubled to ₹10,000.
    • This is a significant enhancement for users making payments without access to smartphones or the internet.

  • Effective Date

    • The new limit will apply starting January 1, 2025.

  • Expanded Reach in Rural Areas

    • With this change, the RBI aims to promote financial inclusion in small towns and villages where feature phones are still widely used.
    • What is UPI 123Pay?

    UPI 123Pay is a Unified Payments Interface (UPI) platform designed for feature phones, enabling digital transactions without requiring internet connectivity.

    Features of UPI 123Pay:
    • IVR Calls: Users can initiate payments by calling an interactive voice response (IVR) number.
    • Missed Call Payments: Payments can be triggered by giving a missed call to a specific number.
    • App-Based Payments: Apps for feature phones support UPI transactions.
    • Sound-Based Payments: Users can complete transactions using sound wave technology.
    Security Enhancements
    • Aadhaar-Based Authentication: A new security layer using Aadhaar-based One-Time Token (OTT) authentication has been introduced.
    • Improved User Experience: UPI Numeric ID Mapper makes payment integration more user-friendly and seamless.
    Difference Between UPI 123Pay and UPI Lite

  • UPI 123Pay:

    • Designed for feature phones.
    • Does not require internet connectivity.
    • New payment limit: ₹10,000 per transaction.

  • UPI Lite:

    • Designed for smartphones with a wallet-based system.
    • Allows transactions up to ₹500 without a UPI PIN.
    • Maximum daily transaction limit: ₹2,000.
    • Impact of the Update
    • Convenience for Feature Phone Users: The increased limit will support higher-value transactions for those without access to smartphones.
    • Boost to Digital Payments: Enhanced limits and robust security measures will drive UPI adoption in semi-urban and rural areas.

    This initiative is another step toward making digital payments universal, fostering inclusion, and supporting India’s vision of a cashless economy.

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