UPI transaction limit per day: What you need to know

Unified Payments Interface (UPI) has revolutionised digital payments in India, offering a seamless and instant method for transferring funds. As its adoption grows, understanding the associated transaction limits becomes crucial for efficient financial planning. Being aware of these limits ensures that your transactions proceed smoothly without unexpected interruptions.

Understanding the transfer limit of UPI

The NPCI has established a standard daily transaction limit of ₹1 lakh for UPI payments. However, this limit isn't uniform across all banks; some institutions may impose lower limits based on their internal policies. Additionally, for specific transactions such as payments to educational institutions, hospitals, and certain government services, the limit is extended up to ₹5 lakhs per day. Limits for credit card bill payments, insurance services will be up to ₹2 lakhs. It's advisable to consult your respective bank to understand their specific UPI transaction limits.

What is interchange fee or surcharge fee on UPI Payment?

An interchange fee or surcharge fee on UPI payments is a transaction charge levied by banks or payment service providers when payments are made to merchants using credit cards or prepaid wallets linked to UPI. This fee covers processing costs and is usually applicable to high-value merchant transactions, while peer-to-peer (P2P) and small merchant UPI transactions typically remain free for users.

Guidelines for UPI transactions

While UPI transactions are predominantly free for users, certain guidelines have been established:

• Exemptions: Peer-to-peer (P2P) and peer-to-merchant (P2M) transactions directly between bank accounts are exempt from interchange fees.
• Transaction limits: A standard cap of 20 P2P transactions per day is in place, though this may vary from bank to bank.

These guidelines ensure the sustainability of the UPI ecosystem while maintaining its user-friendly nature.

UPI transactions that are exempted from transaction fees

Not all UPI transactions incur fees. Exemptions include:

Personal transfers:

Sending money to friends or family directly from your bank account via UPI remains free.

Bank account-based payments:

Transactions made directly between bank accounts using UPI do not attract any charges.

Small merchant payments:

A turnover below ₹20 lakhs will categorise a business as a small merchant. Interchange will be exempted for small offline segment merchants where the transaction value is below ₹2,000.

Daily transaction limit for UPI

While the NPCI sets a general daily transaction limit of ₹1 lakh, individual banks may impose their own limits based on internal policies. For instance, some banks might set daily UPI transaction limits ranging from ₹25,000 to ₹1 lakh. Additionally, certain banks may have weekly or monthly caps. It's essential to check with your bank to understand their specific UPI transaction limits.

With IDFC FIRST Bank Savings Account, you enjoy seamless integration with any UPI payment app and pay across 60 million merchants just by scanning the QR Code. While the UPI payment apps have a daily limit of up to ₹1 lakh, you can avail up to ₹6 lakhs daily purchase limit and ₹2 lakhs daily cash withdrawal with the ₹25K AMB (Average Monthly Balance) Savings Account. In addition, you enjoy one of the highest interest rates in the sector with zero fee banking on all common savings account services.

Things you must know as a UPI user

To make the most of UPI services, keep the following in mind:

Inactive UPI IDs:

Banks are required to deactivate UPI IDs linked to dormant accounts to maintain security.

Transaction limits:

Be aware of your bank's specific UPI transaction limits to plan your payments accordingly.

Security measures:

Always verify transaction details and be cautious of phishing attempts to ensure safe transactions.

 

Staying informed about these aspects will help you use UPI services more effectively and securely.

Conclusion

UPI has significantly transformed digital payments in India, offering a blend of convenience and efficiency. By understanding transaction limits, associated fees, and adhering to established guidelines, users can ensure a seamless payment experience. Staying informed and proactive is key to leveraging the full benefits of UPI in your daily financial activities.