The National Payments Corporation of India (NPCI) has mandated compliance by January 10 with the banking regulator’s directive to elevate the UPI transaction cap to ₹5 lakh for hospitals and educational services, according to Business Standard report.
NPCI has urged banks, payment service providers (PSPs), and UPI applications to adjust transaction limits for specific merchant categories to adhere to this update.
“It is a move in the right direction. The average ticket size has gone up in these sectors. So, it’s a good move to increase the limits," said Vishwas Patel, joint managing director, Infibeam Avenues.
He anticipates no significant challenges in implementing these changes by January 10. PhonePe has also confirmed that it was “on track to roll out the required changes for users as per the prescribed timelines."
Also read/watch - RBI raises UPI limit to Rs 5 lakh per transaction for hospitals and educational institutions
It's emphasized that the increased limit—from approximately ₹1 lakh to ₹5 lakh—will exclusively apply to "verified merchants."
“Members (PSPs&Banks), UPI apps, merchants, and other payment providers are requested to take note of the enhancement, and undertak requisite changes. Members are requested to ensure compliance with the same by 10th January 2024," it said in a circular.
Merchants are mandated to activate UPI with enhanced limits. The responsibility of vetting and adding merchants to the verified list rests with acquiring entities after conducting due diligence.
“Here, the due diligence is to be done by the merchant acquirer and not by PhonePe in its role as a third-party application provider (TPAP). That said, since we also play the role of an acquirer, we have our own internal due diligence process to ensure conformance with the regulatory requirements," PhonePe said in a statement, BS reported.