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NPCI can now adjust UPI limits for merchant transactions
09 Apr 2025

The Reserve Bank of India (RBI) has given the National Payments Corporation of India(NPCI) the power to revise transaction limits for Unified Payments Interface (UPI) payments from people to merchants.

RBI Governor Sanjay Malhotra announced the decision during the Monetary Policy Committee meeting today.

The move aims to add flexibility to the digital payments ecosystem and is part of a larger effort by the central bank to modernize payment infrastructure.

NPCI to consult with banks for limit revisions
Consultation process

The NPCI will have the freedom to modify UPI transaction limits for in-person merchant payments, which are currently capped at ₹2 lakh.

Meanwhile, the cap on person-to-person (P2P) UPI payments will remain the same at ₹1 lakh.

Any changes to these limits will be made in consultation with banks and other stakeholders of the digital payments ecosystem.

This move is likely to facilitate high-value transactions in travel, healthcare, education, and retail sectors more efficiently.

Industry reacts positively to RBI's decision
Industry response

Welcoming the RBI's decision, Mufinpay CEO Ankush Julka said larger transaction sizes for payments to merchants could support high-value use cases better.

He noted that this move would lead to faster adoption of digital payments by consumers and businesses alike.

"It will lead to faster consumer as well as business adoption of digital payments for even greater convenience as well as credibility," Julka said.

RBI to implement safeguards for increased transaction limits
Safety measures

The RBI has assured that appropriate safeguards will be put in place to mitigate risks associated with higher transaction limits.

Banks will also have the discretion to decide their own internal limits within those announced by NPCI.

This move is expected to support the growing demand for high-value digital transactions in sectors such as insurance, mutual funds, travel, and high-end retail.