UPI Limit Per Day: What You Need to Know About Daily Limits?

The Unified Payment Interface (UPI) was developed by the National Payments Corporation of India (NPCI). UPI enables real-time transfers between accounts, banks, and merchant accounts using mobile devices. Additionally, UPI Limit Per Day simplifies bank-to-bank payments by providing a user-friendly payment method. It has gained popularity. Is widely regarded as the preferred payment system, in India.

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What is a Prepaid Payment Instrument (PPI) in UPI?

The term Prepaid Payment Instrument (PPI), in the context of UPI refers to wallets, which enable individuals to store money and conduct online transactions. PPIs encompass forms such, as wallets, smart cards, preloaded gift cards, vouchers, and magnetized chips.

Payments made through PPI occur when a transaction is conducted using a wallet, such as a PhonePe wallet, by scanning a UPI QR code. Other examples of wallets include Paytm wallets, SODEXO vouchers, Amazon Pay, and Freecharge wallets.

Can Banks & UPI Apps Set UPI Transaction Limits?

Banks have the authority to establish their limits for UPI transactions. This also applies to UPI payment apps such as Google Pay, PhonePe, and PayTM. Nonetheless, it is important to note that these transaction limits must fall within the limits set by the NPCI.

To determine the amount you can transfer using UPI apps, it is important to consider the UPI Limit Per Day limits imposed by the app you are using and also those set by the bank that holds your linked account.

UPI Transfer Limit Per Day

The National Payments Corporation of India (NPCI) has set the transaction limit, for UPI at Rs. 1 lakh. However, it’s important to note that this limit can vary from one bank to another. For instance, the State Bank of India (SBI) has a UPI transaction limit of Rs 1,00,000.

Apart from the cap, there is also a restriction on the number of transactions one can carry out in a day. The upper limit for UPI transactions, per day stands at 10. This implies that you can only initiate or receive money transfers up to 10 times within a span of 24 hours using UPI.

If you go beyond the transaction limit for UPI, you won’t be able to carry out any transactions until the day. Additionally, you have the option to get in touch with your bank and request an increase, in your UPI transaction limit.

Here are some of the factors that can affect your UPI transaction limit:

Your bank
Your account type
Your UPI PIN
Your mobile number
Your KYC (know-your-customer) details

Some banks have also established monthly limits, for UPI transfers, rather than daily limits. As an illustration, IDFC Bank has set a UPI limit of Rs. 1 lakh and a monthly transaction limit of Rs. 30 lahk.

If you’re not sure, about the limit of your UPI transactions, you can get in touch with your bank or the UPI application you are currently using.

Surcharge/Interchange Fee on UPI Limit Per Day Payment

When making UPI payments, from bank accounts to bank accounts, there won’t be any charges or interchange fees. However, if you make UPI transactions using payment instruments (PPIs) such as wallets or cards and the transaction amount exceeds Rs 2,000 a merchant will have to pay an interchange fee of up to 1.1%. It’s important to note that this fee is not borne by the customer but rather, by the merchant.

The interchange fee refers to a percentage of the transaction value that merchants pay to the payment service provider (PSP). The PSP then shares this fee with the bank that issued the payment instrument. This interchange fee serves to cover the expenses associated with processing UPI transactions. Also acts as an incentive for merchants to accept UPI payments.

The fee charged for UPI transactions is still quite reasonable, in comparison to payment methods like credit cards. This is because UPI offers a cost-efficient approach, to handling payments.

Below you’ll find a list displaying the interchange fees associated with UPI transactions made through PPIs.

Merchant Category Code	Interchange Fee
Fuel	0.5%
Education	0.5%
Agriculture	0.5%
Utilities	0.5%
Supermarket	0.7%
Insurance	0.9%
Mutual Fund	0.9%
Government	0.9%
Railways	0.9%
Others	1.1%

table

On September 30, 2023, the National Payments Corporation of India (NPCI) will be reevaluating the interchange fee associated with UPI transactions. It is anticipated that there could be adjustments to the fee, either an increase or a decrease.

Will Customers have to Pay the Interchange Fee on UPI Payments Made via Wallets?

Customers won’t be charged interchange fees when using PPIs, for UPI payments in both peer-to-peer (P2P) and peer-to-merchant (P2M) transactions. P2P transactions involve transferring money between two individuals or individual accounts using UPI, while P2M refers to customers making UPI payments to merchants, for their purchases.

One bank imposes an interchange fee on another bank to handle a transaction. When it comes to UPI transactions, the merchant bank (the entity or individual receiving payment) is responsible, for paying the interchange fee to the payer bank (the person making the payment).

The charges, for interchanges are only applicable to merchant transactions using PPI. Customers do not need to pay any fees for UPI payments when they are connected to a bank. However, merchants will be responsible for paying the interchange fee if the UPI is linked to a wallet. It’s important to note that this fee does not impact customers who make UPI payments, to their family, friends, or individuals as the merchant’s bank account.

Who will Pay the Interchange Fees?

Merchants are responsible, for paying the interchange fees to card issuers or wallets. These fees primarily affect shopkeepers, so they won’t have an impact on them. Shopkeepers will only need to pay interchange fees for transactions exceeding Rs. 2,000. However, when it comes to high-value transactions merchants have the choice of either absorbing the increased costs themselves or passing them on to customers.

As a request, the NPCI has instructed the PPI issuers to levy a service charge of 15 basis points to remitter banks for reloading wallets with amounts exceeding Rs. 2,000.

For instance, when you top up your PhonePe wallet with an amount exceeding Rs. 2,000, PhonePe will deduct a service charge of 0.15% from your bank as a fee for loading the wallet.

Therefore, you won’t be required to pay any charges, for topping up your wallet in order to conduct UPI transactions.

UPI New Guidelines or UPI Limit Per Day Guidelines

The NPCI has suggested an interchange fee of around 1.1% for UPI transactions exceeding Rs. 2,000 made through PPIs. This fresh regulation will come into effect on April 1st, 2023, and the pricing, for interchanges will be reassessed by September 30th, 2023.

Conclusion

UPI has completely transformed the way money transactions are carried out in India, with a network of banks and payments of trillions of rupees. Transaction limits are determined by banks and UPI payment apps. They must adhere to the maximum limit set by NPCI. The inclusion of RuPay credit cards, on the UPI platform has made it incredibly convenient for customers to make payments using their credit cards. Bank-to-bank transfers continue to be free. Merchants will now be charged a 1.1% fee for UPI transactions, over ₹2,000 if they use payment instruments starting from April 1, 2023.