The National Payments Corporation of india (NPCI) has made significant changes to the Unified Payments Interface (UPI) system, which will affect both high-value transactions and the UPI Collect feature. Here’s a breakdown of the latest updates:

1. UPI Transaction Limit Raised to ₹10 Lakh

One of the most anticipated changes to the UPI system is the increase in the daily transaction limit for high-value transactions.

· New Limit: UPI users can now transfer up to ₹10 lakh per day, a significant boost from the previous limit of ₹2 lakh to ₹5 lakh for premium or high-value transactions.

Why the Change?

· Facilitating Larger Transactions: This move is expected to make UPI more versatile, allowing for higher-value payments, especially for businesses, large-scale payments, and transactions involving high-value purchases.

· Boosting wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital Payments: It is also seen as a step toward further digitizing the economy, giving users and businesses more flexibility when using UPI as a payment tool.

What Does This Mean for Users?

· Enhanced Convenience: Individuals or businesses making large payments can now do so via UPI without resorting to traditional banking channels like RTGS or NEFT.

· Impact on business Transactions: This will be particularly useful for businesses that frequently make large payments or receive high-value transactions through UPI.

· Increased Competition for Payment Systems: The move positions UPI as an even more competitive alternative to other payment systems like IMPS and RTGS for large-scale payments.

2. UPI Collect Feature Closed from october 1

In addition to the increased transaction limit, there’s another significant update: the UPI Collect feature has now been closed starting from October 1, 2025.

What is UPI Collect?

· The UPI Collect feature allows merchants, businesses, and even individuals to collect payments directly from users by sending them payment requests via UPI. It simplifies the process of receiving funds, especially for businesses dealing with recurring payments or bulk transactions.

Reason for the Closure

The NPCI has decided to discontinue the UPI Collect feature for several reasons:

· Security Concerns: There were concerns about fraudulent activities and misuse of the UPI Collect feature for unauthorized or suspicious transactions.

· Regulatory Compliance: The NPCI may have opted to refine and enhance the feature to ensure better regulatory compliance, especially in terms of anti-money laundering (AML) and Know Your customer (KYC) norms.

What Happens Now?

· Alternatives: Businesses and individuals who were using UPI Collect to receive payments will need to shift to other payment mechanisms such as UPI Payment Links, QR codes, or merchant accounts with banks.

· Transition Period: Users and businesses will need to adapt quickly to these changes to avoid disruption in their payment processes.

3. What Does This Mean for UPI Users?

These updates to UPI will have a varied impact depending on the user type:

For Regular Users:

· Higher Transaction Flexibility: You can now send or receive higher-value transactions seamlessly via UPI. This is ideal for individuals who make large purchases or transfers, such as paying for property or making business-related payments.

For Businesses:

· Bigger Payments Made Easy: With the higher limit, businesses can manage large transactions directly through UPI without needing to switch to more complicated banking methods.

· Adapt to New Payment Methods: If you were using UPI Collect, you’ll need to adjust your payment collection methods and consider alternatives like UPI Links or QR Codes to receive funds.

For Financial Institutions:

· Monitoring Transactions: Banks will have to ensure that the increased limits are adhered to with proper security checks and monitoring systems in place to handle high-value transactions and prevent misuse.

4. How Will This Impact UPI’s Future?

The changes indicate that UPI is evolving as an even more comprehensive tool for both consumer payments and business transactions. This evolution could result in:

· Wider Adoption: The ability to handle larger payments will likely increase UPI adoption for high-value transactions, especially in sectors like real estate, large-scale retail, and government payments.

· Increased Innovation: The closure of UPI Collect may encourage the development of new tools and features that address the needs of businesses while ensuring better security and compliance.

· International Expansion: With these updates, UPI may become a more attractive option for cross-border payments and international partnerships, as the platform will be able to handle larger and more diverse transaction types.

5. What Should You Do Now?

· Check Your UPI Limits: If you regularly make high-value transactions, make sure your bank’s UPI service can support the new ₹10 lakh limit. You might need to enable premium UPI services or set up additional security protocols for such transactions.

· Adapt to New Payment Collection Methods: If you are a business using UPI Collect, start exploring alternative payment methods like UPI QR Codes, payment links, or bank-provided merchant solutions.

Conclusion:

The increase in UPI’s daily transaction limit and the closure of the UPI Collect feature mark a major shift in India’s digital payments landscape. While the higher limit makes large-scale transactions easier, the removal of the UPI Collect feature encourages businesses to shift to other methods of receiving payments.

As UPI continues to evolve and grow in its capacity, it’s important for both individual users and businesses to stay informed and adapt to these changes to ensure a seamless payment experience.

 

Disclaimer:

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk.

For more interesting updates wa click and follow Indiaherald WhatsApp channel

Find out more:

UPI

Balasahana Suresh

16/09/2025 12:39 PM