Digital payments in India have been growing rapidly, with UPI (Unified Payments Interface) leading the way.
To enhance user experience, the Reserve Bank of India (RBI) has introduced two new features in its August 7 policy update.
These include increasing the tax payment limit through UPI and introducing a new delegated payment service.
Increased Tax Payment Limit
Currently, UPI users can make tax payments up to Rs 1 lakh. RBI Governor Shaktikanta Das announced that this limit will be raised to Rs 5 lakh per transaction.
This change aims to simplify high-value transactions, both direct and indirect. Updated instructions on this new limit will be provided separately.
Introduction of Delegated Payment Service
The new delegated payment service allows one person (the primary user) to authorize another person (the secondary user) to make UPI transactions from their bank account.
The primary user will set the transaction limits for the secondary user.
This feature is expected to broaden the use of digital payments in India. Detailed guidelines will be issued soon.
Impact on Minor Users
Mohit Bedi, co-founder of Kiwi, a third-party payment application, highlighted that this new feature will enable parents to allow their children to make UPI payments from their accounts.
Parents will need to approve these transactions, introducing a new system within UPI applications.
Expanding UPI User Base
As of now, the UPI user base in India has reached 42.4 crores. The introduction of delegated payments is expected to further expand this base and increase the adoption of digital payments across the country.
