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RBI announces higher UPI transaction limits for healthcare & education institutions

Healthcare and education institutions now have higher Unified Payments Interface (UPI) transaction limitations from the RBI. Individuals can now pay up to Rs 5 lakh, enabling larger transactions and simpler financial processes.

RBI governor Shaktikanta Das raised certain Unified Payments Interface (UPI) transaction limitations on Friday. The central bank governor also limited recurring payment e-mandates.

UPI transaction restrictions raised

New UPI transaction limits allow individuals to make payments up to Rs 5 lakh instead of Rs 1 lakh for specific payments.

These payment categories include hospitals and schools.
The limit for different UPI transactions has been reviewed periodically. The RBI governor said the UPI transaction limit for hospitals and schools should be raised from Rs 1 lakh to Rs 5 lakh. “This will help the consumers to make UPI payments of higher amounts for education and healthcare purposes,” he said.

Sachin Castelino, Chief Strategy & Transformation Officer at In-Solutions Global Ltd., said the RBI’s decision to raise the UPI payment limit to healthcare and educational units from Rs 1 lakh to Rs 5 lakh suits these sectors’ changing needs.
This permits larger transactions, making healthcare and education financial processes easier. “This decision will enable seamless and substantial transactions in these critical domains,” he says.

Castelino said the greater limit improves UPI transaction efficiency, meeting digital payment demand. “It simplifies healthcare and education business transactions by providing a stronger framework. This RBI decision shows a proactive strategy to adapting digital payment systems to important sectors’ needs, advancing India’s digital economy, he argues.

E-mandate for recurring payments: New rules

The RBI has recurring payment e-mandates. Additional factor authentication is required over Rs 15,000. This ceiling has been raised to Rs 1 lakh for mutual fund, insurance, and credit card payments.

“e-Mandates for recurring payments have become popular among customers,” says the central bank governor. This framework requires AFA for recurrent transactions over Rs 15,000. “It is now proposed to enhance this limit to Rs 1 lakh per transaction for recurring payments of mutual fund subscriptions, insurance premium subscriptions and credit card repayments,” he said in a release. “This measure will further accelerate the usage of e-mandates,” said.
The RBI governor made these announcements in December 2023’s monetary policy statement. The MPC maintained the key repo rate for the 5th time.

Conclusion

Healthcare and education institutions now have higher Unified Payments Interface (UPI) transaction limitations from the RBI. Users can now make UPI payments up to Rs 5 lakh instead of Rs 1 lakh for specific payments. This major change addresses these sectors’ changing needs and allows for greater transactions and smoother financial processes. The RBI’s rise in UPI payments to healthcare and educational entities improves UPI efficiency and meets the growing demand for digital payments. The RBI has also increased e-mandate limitations for recurring payments to Rs 1 lakh for mutual fund, insurance premium, and credit card payments. These modifications were made in the December 2023 Monetary Policy Statement, with the MPC holding the key repo rate constant for the fifth time.

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