UPI going to make big changes from next week

New Delhi. If you also use Unified Payment Interface (UPI), then a big change is going to happen soon. The government had said in a circular that taxpayers can soon make tax payments of up to Rs 5 lakh through UPI. Earlier this limit was very low. This change will provide great relief to lakhs of taxpayers.

The National Payments Corporation of India (NPCI) has increased the transaction limit for tax payments using UPI to help millions of taxpayers in the country. The circular was issued by NPCI on August 24, 2024. It said that UPI is emerging as a preferred payment method, due to which there is a need to increase the per transaction limit in UPI for special categories. It further said that the per transaction limit in UPI for entities has been increased to Rs 5 lakh for tax payments.

NPCI gave instructions to banks

NPCI asked banks, payment service providers and UPI apps to ensure that the transaction limit for MCC 9311 category of verified merchants should be increased. NPCI said that taxpayers should also ensure that UPI is enabled as a payment mode for the increased limit for the tax payment category.

Till when will this limit be applicable?

NPCI has asked banks, payment service providers and UPI apps to implement the increased tax payment limit by September 15. This means that one can use UPI to make tax payments of Rs 5 lakh till September 16. Along with this, individuals can now make UPI payments of up to Rs 5 lakh per transaction for other categories as well.

You can also pay up to Rs 5 lakh for these services

UPI payments up to Rs 5 lakh can also be made for hospitals and educational institutions, IPOs and RBI Retail Direct Schemes, but it is worth noting that this will be applicable only on a few transactions. Apart from this, you will have to check with your bank and UPI to know what limit they are allowing.

How much limit on which services?

UPI limit of up to Rs 1 lakh has been given for most peer to peer transactions. However, these banks decide what their UPI limit will be. For example, Allahabad Bank gives a limit of up to Rs 25000 for UPI payment. HDFC Bank and ICICI Bank have fixed the limit at Rs 1 lakh. UPI limit for capital market, collection, insurance and foreign transactions is up to Rs 2 lakh.