NPCI to decide on UPI merchant transaction limits, says RBI Governor

India’s central bank, the Reserve Bank of India, on Wednesday said that it will allow the National Payments Corporation of India (NPCI) to revise the transaction limits for Unified Payments Interface (UPI) payments made to merchants. The move is aimed at making the digital payments system more responsive to the economy’s needs.

Speaking at a press briefing, RBI Governor Sanjay Malhotra said, “RBI is enabling NPCI to decide, in consultation with the banks and other stakeholders, the transaction limits in UPI for person to merchant transactions.” Currently, the limit for such transactions stands at Rs 2 lakh.

The new policy framework gives NPCI—the umbrella body for retail digital payments—greater flexibility in calibrating limits for person-to-merchant (P2M) payments. “We will give the freedom to NPCI, in consultation with other stakeholders, to revise it as per the needs of the economy,” Malhotra added.

However, limits on person-to-person (P2P) UPI payments will remain unchanged. “I may also clarify over here that the P to P transaction limit, which is one lakh rupees as of now, will remain the same, and there is no change with regard to the regulations,” Malhotra said.

"RBI’s move to empower NPCI to revise UPI transaction limits for merchant payments is a much-needed and welcome reform. It reflects a deep understanding of the changing needs of users and businesses alike," Vishwas Patel, Joint MD, Infibeam Avenues, and Chairman of the Payments Council of India (PCI), said.

"This flexibility will allow the ecosystem to cater to more high-value use cases like insurance premiums, education fees, and B2B transactions, while still upholding safety. It’s a win-win for consumers, merchants, and payments players. We at PCI fully support this initiative and will work with all stakeholders to ensure its effective implementation," he added.

(The copy was updated with statement from PCI.)