What’s Changing in UPI From October 1, 2025
Starting October 1, 2025, new Unified Payments Interface (UPI) rules issued by the Reserve Bank of India (RBI) and National Payments Corporation of India (NPCI) come into effect. These aim to improve user safety, prevent dormant account misuse, and tighten merchant onboarding norms.
The biggest change? Inactive UPI IDs will be auto-deactivated if unused for 12 months. According to Rbi Upi Guidelines 2025, users can reactivate easily by authenticating once with their bank or payment app. This move helps curb fraud and fake account activity in India’s 35-crore-plus UPI base.
Other highlights include stricter auto-pay rules for recurring mandates, enhanced merchant KYC checks, and new fraud-detection APIs for banks and PSPs. UPI apps will now have to verify beneficiary device binding and account activity before approving high-value transactions.
Insight: UPI isn’t just growing in numbers — it’s evolving for safety, transparency, and trust in India’s digital payments future.Why RBI and NPCI Updated UPI Rules
UPI processed over 17 billion transactions in August 2025 — up nearly 45% year-on-year. With this scale came rising cases of phishing, fake app clones, and merchant-level fraud. The October rule update is RBI’s response to this growth, ensuring the system remains secure as it expands into cross-border and credit-linked UPI use cases.
According to Upi Autopay Changes, RBI observed multiple failed and unverified auto-pay mandates across platforms. The new rule now mandates pre-debit notifications and explicit user confirmation for transactions above ₹15,000.
Key reasons behind the update:
- Security: Deactivate dormant UPI IDs to stop misuse.
- Compliance: Strengthen merchant verification and onboarding.
- Transparency: Make recurring payments safer with user confirmations.
- Scalability: Prepare the network for high-value and cross-border UPI flows.
RBI’s push aligns with its 2026 Digital Payments Vision, which prioritizes “trust-led growth.” NPCI’s updated API suite will help banks and fintechs automate compliance checks while keeping user experience frictionless.
Tip: RBI’s rule refresh isn’t a crackdown — it’s a cleanup, making UPI stronger for India’s next billion digital users.What It Means for Users and Merchants
For regular users, these updates won’t disrupt daily payments — but they do bring subtle improvements in safety. You’ll now receive alerts if your UPI ID is inactive or if an auto-debit exceeds the set threshold. Dormant users can easily reactivate accounts via their bank app or UPI platform.
For merchants, compliance gets stricter. According to Merchant Compliance Upi, payment service providers must ensure that merchant KYC data is verified before onboarding. Refunds must be processed within T+1 days for disputed transactions, improving consumer confidence.
Here’s how the rule changes impact stakeholders:
- Users: Fewer fraud attempts, transparent alerts, and stronger account control.
- Merchants: Must meet tighter KYC and refund guidelines.
- Banks: Need to adopt fraud analytics and real-time risk flagging.
- Fintechs: Can use new APIs for faster fraud reporting and compliance updates.
NPCI has also directed that any payment app not accessed for 12 months must prompt re-authentication, similar to OTP reactivation for SIMs. This ensures money doesn’t flow through dormant or unauthorized UPI handles.
Insight: For users, this is digital hygiene; for merchants, it’s accountability. For India, it’s trust by design.How to Stay Compliant and Avoid Payment Issues
To avoid disruptions post-October 1, ensure your UPI accounts and auto-pay mandates are active and verified. Through Upi Security And User Safety, you can check your account activity, update device bindings, and review auto-debit permissions.
Simple steps to stay safe:
- Open your UPI app and make a small payment to keep IDs active.
- Verify your registered device and SIM card before the rule change.
- Review all recurring payments above ₹15,000 — confirm or reauthorize as required.
- Report inactive merchants or suspicious requests via in-app support.
RBI and NPCI have also encouraged users to link only one mobile number to a primary UPI ID for consistent verification. Apps failing to follow new device security protocols could face penalties or temporary delisting from the UPI network.
Tip: Treat your UPI ID like your bank account — maintain, verify, and update it regularly for uninterrupted access.Frequently Asked Questions
1. What are the new UPI rules effective October 1, 2025?
RBI and NPCI will deactivate inactive UPI IDs, tighten auto-pay rules, and enhance merchant KYC verification from October 1, 2025.
2. Why is RBI introducing these UPI changes?
To strengthen digital payment security, prevent misuse of dormant accounts, and ensure transparent recurring transactions.
3. Will my UPI stop working after October 1?
No, only inactive IDs (unused for 12 months) will be temporarily disabled until reactivated by users.
4. How do these rules affect merchants?
Merchants must complete KYC verification, process faster refunds, and comply with RBI’s new payment timelines.
5. What should users do before the rule change?
Use your UPI ID at least once, confirm auto-pay mandates, and verify your device and SIM to avoid deactivation.