RBI Raises UPI Transaction Limit For Government Bond Purchases, IPOs
RBI raises UPI transaction limit to Rs 5 lakh for some transactions.
The Reserve Bank of India will raise the limit for select transactions on the unified payments interface to Rs 5 lakh from Rs 2 lakh.
The enhanced limit will apply for transactions undertaken on the regulator’s retail direct scheme for purchase of government securities and for initial public offering applications, Shaktikanta Das, governor at the RBI, said after announcing the Monetary Policy Committee’s decision on rates.
The Rs 2-lakh-per transaction limit will continue to apply for all others.
Besides raising transaction limits, the RBI proposed to launch UPI-based payments products for feature phone users, leveraging on the options developed in its regulatory sandbox.
According to the RBI's assessment, 50% of all UPI transactions were worth less than Rs 200 each. This means that the platform has achieved its initial objective, the regulator said in its statement.
"These low value transactions, however, utilise significant system capacity and resources, at times leading to customer inconvenience due to transaction failures because of issues related to connectivity," the RBI said.
The regulator and the National Payment Corporation of India will work to simplify the process flow for these small-value UPI transactions by introducing an on-device wallet. The wallet will help conserve bank system resources without affecting the transaction experience for users, the statement said.
According to data available with the National Payments Corporation of India, November saw UPI transactions worth Rs 7.68 lakh crore. In October, such transactions hit an all-time high of Rs 7.71 lakh crore, doubling year-on-year.
Additional Measures
Domestic banks need not seek prior approval of the RBI to infuse capital or repatriate profits from their overseas subsidiaries, if they meet the regulatory requirement on capital.
The RBI will release a discussion paper on classification and valuation of the investment portfolio of banks.
The RBI will release a discussion paper on various charges involved in the digital payments ecosystem. The paper will help provide approaches to mitigate concerns and make digital payments more affordable.
Guidelines enabling use of widely accepted interbank rates or alternative reference rate to be issued, as the system moves away from the London interbank offered rate or Libor.