RBI Increases Wallet Limit For UPI Lite To INR 5,000

With an eye on further increasing the adoption of digital payments in the country, the Reserve Bank of India (RBI) has increased the wallet limit for UPI Lite to INR 5,000 from INR 2,000 previously. 

The central bank also announced on Wednesday (December 4) that the offline transaction limit for UPI Lite service will be increased to INR 1,000 per transaction from INR 500 currently. The new limits will come into effect immediately.

The new changes came as the RBI amended its framework for facilitating small value digital payments in offline mode. 

“The framework, inter-alia, prescribes an upper limit of INR 500 for offline digital payment transaction(s), and a total limit of INR 2,000 for a payment instrument at any point in time… The offline framework has been updated and the enhanced limits for UPI Lite shall be INR 1,000 per transaction, with INR 5,000 being the total limit at any point in time,” read the notification. 

UPI Lite was launched in 2022 and enables users to make small-value online transactions without internet connection and a PIN. Skipping reliance on a bank’s core banking systems in real-time, the offering enables offline debit for payments but credits can only be made once the user is online. 

This comes a couple of months after the central bank, post the meeting of its Monetary Policy Committee in October this year, announced plans to increase the transaction cap for UPI Lite to INR 1,000. At the time, it had also said that the per transaction limit of UPI123 Pay would be increased to INR 10,000 from INR 5,000 currently.

This comes at a time when the RBI has been actively experimenting with new UPI offerings to deepen the penetration of UPI payments in the country. In August 2024, RBI governor Shaktikanta Das launched UPI Circle, which allows customers to link with trusted secondary users on the UPI app for either partial or full delegation of payments. 

Last year, the National Payments Corporation of India (NPCI) also unveiled Hello UPI, a conversational UPI payment offering, and UPI Tap & Pay, which enables users to make payments by tapping their phone on a contactless reader. 

Buoyed by increasing smartphone and internet penetration, digital payments continue to be on the rise in the country. UPI reported 1,548 Cr transactions in November 2024, up 38% from 1,100 Cr transactions in the year-ago period. Meanwhile, the value of transactions on the payments infrastructure jumped 24% to INR 21.55 Lakh Cr last month from INR 17.4 Lakh Cr in November 2023.