Why RBI and NPCI Are Raising UPI Limits
The Reserve Bank of India (RBI) and National Payments Corporation of India (NPCI) have decided to raise UPI limits across key sectors in 2025 — from insurance and healthcare to education and investments. The goal is to make big-ticket digital payments smoother and bring more users into high-value transactions through UPI.
As outlined in Upi Limit Update 2025, these new caps let users pay up to ₹5 lakh per transaction for healthcare and education and up to ₹10 lakh for premium use cases like mutual funds, tax, and insurance. It’s a strategic move to strengthen India’s shift from cash-based to fully digital settlements.
RBI’s data shows that UPI now accounts for over 80% of retail digital transactions. Raising the limits gives users and merchants greater flexibility — and positions UPI as India’s default platform for both micro and macro payments.
Insight: The new UPI caps aren’t about speed — they’re about scale and trust in digital transactions.Which Apps and Banks Are Ready for the Change
Not every UPI app or bank can instantly process high-value transactions. NPCI has rolled out the changes in phases, and readiness depends on your app provider and bank integration under Rbi Upi Guidelines.
Here’s a quick look at apps and banks already live with new limits:
- UPI Apps: BHIM, PhonePe, GPay, and Paytm have updated infrastructure to support ₹5 lakh payments for insurance and healthcare.
- Partner Banks: HDFC Bank, SBI, Axis Bank, ICICI Bank, and Federal Bank are early adopters of big-ticket UPI transactions.
- Coming Soon: Regional cooperative banks and new fintech PSPs are expected to upgrade by Q2 2025.
Users can check readiness directly in their app — if your payment screen still shows a ₹1 lakh cap, your bank may not have enabled the updated transaction tier yet.
Tip: If your UPI app fails large payments, try linking another bank account that already supports the higher limit.What New Limits Mean for Users and Merchants
For users, higher caps mean convenience. You can now pay your medical bills, tuition fees, or annual premiums directly through UPI instead of NEFT or card gateways. For merchants, it means faster settlements and fewer payment drop-offs.
Based on Merchant Upi Readiness, here’s how the new limits are structured:
| Category | Old Limit | New Limit (2025) | Remarks |
|---|---|---|---|
| Healthcare & Hospitals | ₹1 lakh | ₹5 lakh | For approved hospital and clinic UPI handles |
| Insurance & Education | ₹1 lakh | ₹5 lakh | Enabled for verified institutions only |
| Investments & Mutual Funds | ₹2 lakh | ₹10 lakh | Subject to multi-factor authentication |
| Government & Tax Payments | ₹2 lakh | ₹10 lakh | Allowed via authorized PSPs |
| General Retail & Others | ₹1 lakh | Unchanged | Daily UPI cap still applies |
This update directly benefits small traders, schools, hospitals, and mutual fund platforms — all of which can now handle larger transactions securely through UPI instead of switching payment modes.
Insight: Every extra rupee added to the UPI limit unlocks new sectors for digital growth.How to Check If Your App Supports Big-Ticket UPI
Wondering if your UPI app or bank is ready? The process is simple. Under Future Of Upi Payments, NPCI has mandated all PSPs to publish readiness updates in-app by March 2025. Here’s how to check:
- Open your UPI app (BHIM, PhonePe, GPay, etc.).
- Go to bank account settings and view linked accounts.
- Tap “Transaction Limits” — you’ll see the new cap if enabled.
- Try a small test payment under ₹2 lakh to verify high-value capability.
- Update your app to the latest version if limits don’t appear.
For merchants, ensure your UPI ID is verified and mapped under the correct merchant category (healthcare, education, insurance) to access the revised caps. Failure to do so may result in rejections for large-value collections.
Tip: Don’t worry if your limit isn’t updated yet — banks are rolling out higher caps in phases through 2025.With UPI now powering everything from grocery bills to government payments, these higher limits ensure India’s digital economy can scale without friction. The next time you pay a big bill, your UPI app might surprise you — it’s ready to go beyond ₹1 lakh.
Frequently Asked Questions
1. What are the new UPI limits for 2025?
Users can now pay up to ₹5 lakh for healthcare and education and ₹10 lakh for insurance, mutual funds, and government payments.
2. Which apps support higher UPI payments?
BHIM, PhonePe, Paytm, and GPay have rolled out support for ₹5–10 lakh transactions with select banks.
3. Do I need to upgrade my UPI app?
Yes. Update your app to the latest version and ensure your bank supports the revised caps.
4. Can small traders or merchants benefit too?
Absolutely. Verified merchants in healthcare, education, and insurance sectors can now receive higher UPI payments directly.
5. When will all banks support the new limits?
By mid-2025, all major banks are expected to complete the rollout for high-value UPI transactions.