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RBI to Increase UPI Auto Payment Limits for Specific Transactions
RBI to Increase UPI Auto Payment Limits for Specific Transactions
The RBI has announced plans to raise UPI auto payment limits for certain transactions without the need for Additional Factor Authentication (AFA). This includes transactions such as mutual fund subscriptions, insurance premiums, and credit card repayments, with the new limit set at Rs 1 lakh. The move aims to enhance customer convenience while maintaining transaction security. Additionally, the proposal suggests exempting AFA for transactions up to ₹1 lakh in specified categories, maintaining pre- and post-transaction notifications, opt-out facilities, and more. Separate instructions are also expected to be issued to enhance the limit for payments to hospitals and educational institutions from ₹1 lakh to ₹5 lakh per transaction.
Key Takeaways:
- UPI auto payment limits for specific transactions will be raised to Rs 1 lakh without the need for OTP-based authentication.
- The e-mandate framework, introduced in August 2019, aims to balance digital transaction security with customer convenience.
- The proposal suggests exempting AFA for transactions up to ₹1 lakh in specified categories, maintaining pre- and post-transaction notifications, opt-out facilities, and more.
- Separate instructions are expected to be issued to enhance the limit for payments to hospitals and educational institutions from ₹1 lakh to ₹5 lakh per transaction.
Synopsis:
The case you are referring to is related to the announcement made by the Reserve Bank of India (RBI) regarding the plans to raise UPI auto payment limits for specific transactions without Additional Factor Authentication (AFA). This announcement includes several key points:
1. Increase in UPI Auto Payment Limits: The RBI governor has announced plans to raise UPI auto payment limits for specific transactions to Rs 1 lakh without the need for OTP-based authentication. This includes transactions such as mutual fund subscriptions, insurance premiums, and credit card repayments.
2. Revision of AFA Trigger: The current AFA trigger for UPI auto payments exceeding Rs 15,000 will be revised.
3. E-Mandate Framework: The e-mandate framework, introduced in August 2019, aims to balance digital transaction security with customer convenience. The current limit for e-mandates without AFA is ₹15,000 (last updated in June 2022).
4. Proposal for Exempting AFA: To address the need to enhance the limit for categories like mutual fund subscriptions, insurance premiums, and credit card payments exceeding ₹15,000, the proposal suggests exempting AFA for transactions up to ₹1 lakh in specified categories, while maintaining pre- and post-transaction notifications, opt-out facilities, and more.
5. Enhancement of Limits for Medical and Educational Services: It was also proposed to enhance the limit for payments to hospitals and educational institutions from ₹1 lakh to ₹5 lakh per transaction.
The advantages of UPI Auto Payment and the types of transactions that can be paid through UPI Auto Payment are also highlighted in the case.
This case reflects the RBI’s efforts to balance security and convenience in digital transactions and to encourage the use of UPI for various types of payments.
FAQ:
Q1: What are the advantages of UPI Auto Payment?
- No manual authentication for small transactions
- Streamlined e-mandate process
- Enhanced user experience
- Support for various transactions
- Notification and opt-out features
- Convenience with no penalties or delay in bill payments
- Facilitation of cashless transactions
Q2: What are the types of transactions that can be paid through UPI Auto Payment?
A2: Transactions that can be paid through UPI auto payment include utility bills, mobile recharges, insurance premiums, loan repayment, credit card bills, subscription services, mutual fund investments, rent payments, EMI for purchases, and subscription boxes.
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