The Governor of the Reserve Bank of India, Shaktikanta Das, recently announced significant revisions to the Unified Payments Interface (UPI) transaction limits, primarily focusing on payments to hospitals and educational institutions. The revised policy now permits UPI transactions up to ₹5 lakh per day for these sectors, a substantial increase from the previous cap of ₹1 lakh. This change is particularly noteworthy in the healthcare and education sectors, where financial demands are often urgent and substantial.

Sheersham Gupta, a Senior Technical Analyst at Rupeezy, highlights the importance of this adjustment, noting its potential to enhance financial transactions and ease in these critical sectors. This targeted move is expected to contribute to the macroeconomic stability of essential services like healthcare and education.

In the realm of education, Adhil Shetty, CEO of BankBazaar, points out that the increased UPI limit up to ₹5 lakh addresses the often high and time-sensitive nature of education expenses. This adjustment allows for immediate, hassle-free cash payments, offering an alternative to traditional payment methods like demand drafts.

The August policy update from the RBI also introduced an innovative feature called conversational payments on UPI. This feature, incorporating AI technology, facilitates secure and interactive transaction processes on both smartphone and feature phone-based UPI platforms. Initially, this service will support Hindi and English, with plans to include more Indian languages in the future.

Furthermore, the transaction limit of UPI Lite has been raised to ₹500 from the previous ₹200. UPI Lite, which is available through various payment apps, has seen participation from several major banks.

In a broader context, the UPI system continues to witness significant growth in digital transactions. According to data from the National Payments Corporation of India (NPCI), UPI transactions slightly decreased from October’s 1.141 billion but showed a 54% year-on-year increase compared to November 2022’s figures.

These developments in UPI transaction limits, especially in the healthcare and education sectors, represent a significant step towards financial inclusion and the digitization of payment systems in India.

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