RBI move will benefit both UPI and customers
Large value retail digital transactions have been in the domain of credit cards
image for illustrative purpose
Another positive change to accelerate the use of e-mandates is raising its limit from Rs. 15,000 to Rs. one lakh for mutual fund subscriptions, insurance premium subscriptions, and credit card repayments. These are the steps in the right direction for convenience of consumers and rapid adoption of digital payments in India
In a significant move, the Reserve Bank of India (RBI) on Saturday increased the UPI limit for payments to hospitals and educational institutions to Rs. five lakh per transaction from the existing Rs. one lakh. It has come into force with immediate effect.
Moreover, the transaction limit has been increased from Rs. 15,000 to Rs. one lakh for recurring payments like credit card repayment, mutual fund subscription, and insurance premium payment.
Talking to Bizz Buzz, Ramesh Narasimhan, CEO, Worldline India says, “Today’s announcement by RBI will help the consumers do larger transactions, potentially facilitating smoother and more substantial payments in these two crucial sectors.”
Another positive change to accelerate the use of e-mandates is raising its limit from Rs. 15,000 to Rs. one lakh for mutual fund subscriptions, insurance premium subscriptions, and credit card repayments. These are the steps in the right direction for convenience of consumers and rapid adoption of digital payments in India.
Shivaji Thapliyal, Head of Research and Lead Analyst, Yes Securities, says, “The RBI has once again taken incremental steps to enhance the ubiquity of UPI as a platform for retail digital payments.”
Large value retail digital transactions have generally been in the domain of credit cards and hence, it remains to be seen to what extent allowing higher UPI payments to hospitals and educational institutions would shift transaction value away from credit cards.
“Some of the key segments where large value retail digital transactions have generally taken place are travel bookings, including hotel and flight tickets and larger retail transactions, both in e-commerce and offline retail,” he said.
