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| Photo Credit: Special Arrangement
The RBI has decided to enhance the limit for tax payments through UPI from ₹1 lakh to ₹5 lakh per transaction, Governor Shaktikanta Das announced on Thursday (August 8, 2024).
“UPI has become the most-preferred mode of payments, due to its seamless features. Currently, the transaction limit for UPI is capped at ₹1 lakh. Based on the various use-cases, the Reserve Bank has periodically reviewed and enhanced the limits for a few categories like capital markets, IPO subscriptions, loan collections, insurance, medical and educational services etc,” he said.
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“As direct and indirect tax payments are common, regular and high value, it has been decided to enhance the limit for tax payments through UPI from ₹1 lakh to ₹5 lakh per transaction. Necessary instructions will be issued separately,” he added.
The RBI is also making provision for Introduction of Delegated Payments through UPI which will enable a secondary user to make payments using UPI by making use of the bank account of the primarily user.
“The Unified Payments Interface (UPI) has a very large user base of 424 million individuals. There is, however, potential for further expansion of the user base,” Mr. Das said.
“It is proposed to introduce “Delegated Payments” in UPI. “Delegated Payments” would allow an individual (primary user) to set a UPI transaction limit for another individual (secondary user) on the primary user’s bank account. This product is expected to add to the reach and usage of digital payments across the country. Detailed instructions will be issued shortly,” he added.
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Limit for tax payments via UPI to increase from ₹1 lakh to ₹5 lakh: RBI
