What is the Full Form of UPI?
UPI stands for Unified Payment Interface is a critical component of the digital payment landscape in India which allows users to instantly transfer funds to individuals, merchants through mobile apps by offering a flexible, secure payment method.
Who developed Unified Payment Interface (UPI)?
Unified Payment Interface (UPI) is developed by the National Payments Corporation of India (NPCI) and regulated by the Reserve Bank of India (RBI).
What is the per transaction limit for UPI payments?
As per the National Payments Corporation of India (NPCI) UPI transaction limit is Rs. 1 lakh per day.
Payments related to educational institutions and healthcare, this limit is increased to Rs. 5 lakhs.
The maximum daily transfer limits set by banks for UPI transactions is ranging from Rs. 25,000 to Rs. 1 lakh.
How many UPI transactions are allowed per day as per NPCI's new guidelines?
As per the NPCI, the number of UPI transactions per day limit at 20, after that an users has to wait for 24 hours to resume transactions.
For third-party UPI apps, only 10 transactions are allowed daily.
Additionally, UPI payments via digital wallets like PhonePe, Paytm, and Amazon Pay incur an interchange fee of up to 1.1% for certain merchant payments above Rs. 2000, which is paid by the merchants. Regular customers are not charged transaction fees.
Is there any Interchange Fee or Surcharge Fee on UPI Payment
Yes, interchange fees are applicable to UPI transactions when it is made through (PPIs) prepaid payment instruments like wallets. The fees may vary depending on the category of the merchant.
- Transactions related to fuel incur a 0.5% fee.
- For post office, telecom, utilities, agriculture, and education are charged at 0.7%.
- Supermarket payments attract a 0.9% fee
- Services like insurance, mutual funds, and railways are charged at a rate of 1.1% fee.
Who is responsible to pay the interchange fee?
The merchant who accepts the UPI payment are responsible to pay the interchange fee. Like, if a customer uses UPI to make a payment using a PhonePe QR code at a store, the interchange fee is borne by the merchant, who is responsible to remit the fee to the payment service provider, such as PhonePe.
Are all the customers need to pay interchange fees for UPI payments when made through wallets?
No, customers do not have to pay interchange fees for UPI payments made through wallets as these fees are applicable only to Peer to Peer (P2P) and Peer to Merchant (P2M) transactions conducted through prepaid payment instruments (PPIs) which are borne by merchants when customers use wallets for transactions.
What are Peer to Peer (P2P) and Peer to Merchant (P2M) transaction?
P2P transactions are transferring funds between individuals, where P2M transactions involve customers making payments to merchants for purchases.
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