To give a boost to cashless transactions in the country, the NPCI, after the delay of over a year, will launch the upgraded version of the Unified Payment Service (UPI) platform, UPI 2.0, this week. Though the latest UPI version will be loaded with features like auto debit and double transaction limit, etc., the Reserve Bank of India’s decision to withhold ‘Standing Instruction’ feature could be a dampener.
Among the features to be included in the refurbished version, the most anticipated one is ‘transaction limit’. Focussing on Person-to-Merchant (P2M) transactions in UPI 2.0, the NPCI could increase the transaction limit to Rs 2 lakh from the current Rs 1 lakh.
In the present version, one can only link bank accounts with UPI but the new version could allow businessmen to link overdraft accounts, a flexible borrowing facility on a bank current account, with UPI.
The new upgrade could also allow merchants to refund money without making a new transaction. Also, they would be able to share the reference number of a transaction and block some amount from a customer’s account as a security till the transaction is completed.
The UPI 2.0 will facilitate you with an invoice option as you make a payment through UPI, boosting transparency and seamless transactions.
Though the NPCI was planning to introduce the ‘Standing Instruction’ feature in UPI, a final decision could be only made after the RBI nod. The feature allows recurring payments from your account towards loan payment or bill payment after a specific interval. Experts say allowing of the recurring feature could help in the seamless collection of bill payments or loan payments.
Apart from the ‘Standing Instruction’ feature, biometric ‘Aadhaar Payment’ feature also won’t be available in the new UPI version due to privacy concerns.
UPI, a system that powers multiple bank accounts into a single mobile app and caters to ‘peer to peer’ collection request, was launched in April 2016. NPCI, an umbrella organisation for operating retail payments and settlement systems in India, is an initiative of the RBI and Indian Banks’ Association (IBA) to create a robust payment infrastructure in India.