UPI Transaction Charges: Per Day Limit, Guidelines, Applicability and Rules

• UPI (Unified Payments Interface) facilitates immediate money transfer through mobile devices.
• Normally, you can transact up to ₹1 lakh per transaction. However, the limit is different for different transactions.
• You can link your bank account or PPI (Prepaid Payment Instruments) wallets to UPI to execute various transactions.
• UPI payments through bank accounts do not attract UPI transaction charges. Also, there are no charges to be paid if you are a payment wallet customer.

UPI (Unified Payments Interface), developed by the NPCI (National Payments Corporation of India), is an instant payment system built on the IMPS (Immediate Payment Service) infrastructure. It facilitates instant money transfers between bank accounts.Through this blog, you'll get an overview of UPI, its functionality, UPI transaction charges, and more. Keep reading.

UPI enables immediate money transfers through mobile devices. You can access different bank accounts through a single mobile application. You can pay using UPI at any time of the day at your convenience.Implementing a single-click 2-factor authentication, UPI supports seamless payment through the virtual address of the beneficiary.You can make various payments, such as utility bills, over-the-counter, and QR code-based payments.

Let’s address the limit on UPI payments before discussing UPI transaction charges in the following section.Normally, you can transact up to ₹1 lakh per transaction. However, the limit is up to ₹2 lakh for specific transaction categories, such as capital markets, collections, insurance, and foreign inward remittances. The limit can be higher at ₹5 lakh per transaction for initial public offerings and retail direct schemes.It is always advisable to check with your bank to confirm the applicable limits.

If you are a UPI user making payments through a bank account, there are no UPI transaction charges applicable. You can initiate peer-to-peer and peer-to-merchant transactions at no cost. Interestingly, you can now link your PPI Wallets to UPI. However, interchange fees are applicable in the case of specific PPI merchant transactions.

PPI stands for Prepaid Payment Instrument and empowers you to make purchases and payments through the amount stored within it. You can pre-load PPIs with money and can reload it easily once the balance dips.PPIs include wallets, smart cards, vouchers, and magnetised chips. You can link full-KYC PPI wallets to UPI through your PPI issuer’s application to make PPI payments.

When you pay a merchant through PPI, UPI transaction charges or interchange fees are applicable. These are the charges that a merchant usually pays to the payment service provider.
For instance, if you make a payment at a store through your Amazon Pay wallet, the merchant needs to pay the interchange fee to the wallet service provider i.e. Amazon Pay in this case. Note : The interchange fees depend on the merchant category and the transaction value. As a customer, you are generally not liable to pay any charges.

The process of making UPI payments is easy. You can normally make your first UPI payments in three simple steps as explained below:

• Step 1: Download the designated app of your financial institution. For example, Aditya Birla Capital's ABCD app.
• Step 2: Create your UPI ID for secure and seamless financial transactions.
• Step 3 : Link your bank account to experience smooth fund transfers.

If you have a RuPay credit card, you can link it to UPI; there is no restriction on linking the number of credit cards . However, you won't be able to initiate certain transactions like P2P (peer-to-peer), P2PM (peer-to-peer-merchant), digital account opening, cash withdrawal at ATM, etc.While there is no limit on the number of transactions, there is a cap on the transaction amount. The transaction limit is the least value of the following:

• Card limit set by your bank.
• Spending limit set by you.
• Transaction limit determined by your bank based on its risk framework.

Note : Currently, you can only link Rupay credit cards to UPI; you cannot link Visa/MasterCard credit cards.

Before linking your credit card to UPI, you may want to know about the related credit card UPI charges. Here are some important things you should know:

• There are no credit card UPI charges for linking or executing transactions from your credit card linked to UPI.
• There is a surcharge applicable on specific merchant transactions . For instance, paying for fuel attracts a surcharge.

Also Read: Income Tax On UPI Transactions: Applicability & Receipts

UPI supports round-the-clock fund transfers. From paying utility bills to making over-the-counter payments, it redefines cashless transactions. There are several platforms that support UPI payments, allowing you to choose the one that offers features that align with your financial needs.You can download the ABCD app by Aditya Birla Capital to experience seamless QR code payments through multiple banks, offers, and much more. Also Read: 11 Benefits & Features of Using a Credit Card