To encourage genuine transactions in the UPI ecosystem, the National Payments Corporation of India (NPCI) has revised peer-to-peer (P2P) transactions to 10 from 20.
“The UPI transaction frequency limit has been revised to…10 transactions per bank account for the P2P segment. This limit is inclusive only for P2P transactions originating from a unique bank account,” NPCI said in a circular.
The above limit has been in effect from Sunday. The member banks and service providers have been asked to make required changes and inform stakeholders.
“We believe 10 transactions per day should be good enough for P2P. There are no restrictions for P2M transactions,” Dilip Asbe, chief executive officer, NPCI was quoted as saying by ET.
Two months ago, the payment regulator came out with a circular saying payments transfer within same account or UPI ID (where the payer and the payee account are actually the same) will be blocked by the umbrella organisation for all digital payments in India.
It also asked payment service providers and banks to block such transactions at their end.
The clampdown is said to have been issued to stop customers who do multiple transactions within their account to get cashback offers by UPI-led digital payments platforms such as BHIM, Paytm, PhonePe, Mobikwik, Freecharge and others.
However, the move led to a downfall in UPI transactions to 235 million from 246 million in July.
According to industry experts, the decision to limit the transactions may discourage customers who get cash back and incentives by doing multiple transactions directly or indirectly influenced by digital payments players but it will definitely help in curbing fake transactions.
Ever since its inception, the UPI payment ecosystem has been growing at a fast pace and witnessing a fierce competition among existing and new players. Online payment app PhonePe claims to have secured the top spot on the UPI network. It has crossed 100 million monthly transactions in the month of July.
After Paytm, it’s the second firm on the UPI ecosystem to hit 94 million monthly transaction volume.
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