Mumbai: National Payments Corporation of India (NPCI) has finally introduced a new regulation that needs to be mark your calendars for UPI Lite which is going to start from 1 April 2025. UPI Lite users cannot withdraw the remaining amount from their wallets right now. We are about to change this restriction.
As per a circular issued by National Payments Corporation of India (NPCI) on 21 February 2025, all UPI Lite supporting Payment Service Provider (PSP) banks and applications were mandated to enable the facility of ‘transfer out’ by 31 March 2025. The latest step is intended to improve the convenience of users as they will be able to withdraw funds from their UPI Lite accounts without disabling the service.
Currently UPI Lite works in such a way that one can load money in the wallet but cannot withdraw funds. Users have to deactivate their UPI Lite account first if they want to withdraw funds, as per the website of NPCI.
IMPS has also instructed NPCI that all issuing banks running UPI Lite, should save balances at LRN level. The UPI applications, wherein UPI Lite is enabled, shall enforce app passcode authentication, biometrics or pattern based locks at login, and implement other security measures such as genuine click confirmation with the help of visual or haptic feedback before initiating the transaction. All other UPI Lite guidelines shall remain applicable as is, and these changes will have to be implemented by 31 March 2025.
The Reserve Bank of India(RBI) hiked UPI Lite wallet limit to ₹5,000 from the earlier ₹2,000 in October last year. Meanwhile, per-transaction cap for UPI Lite had also been increased from ₹100 to ₹500. Apart from this, the limit per transaction UPI 123 Pay will be raised to ₹5,000 from with immediate effect ₹10,000.