Why UPI Limits Changed and What It Means
As digital payments grow, the National Payments Corporation of India (NPCI) recognised the need for higher limits in certain categories where users and merchants still had to rely on older methods like NEFT or cheques. Under Upi High Value Payments, from 15 September 2025 new higher transaction and daily limits kicked in for selected merchant categories.
The aim is simple: let users use UPI for high-value payments too, such as insurance premiums, travel bookings, capital market investments, and government fees — without splitting payments. But these enhanced limits apply only when you pay a verified merchant in a specified category.
Insight: UPI is moving from small-ticket everyday payments to becoming a reliable rail for high-value transactions too.New Limits by Category: What You Can Pay Now
Here’s a clear breakdown of the new limits (effective 15 Sept 2025) for person-to-merchant (P2M) payments under specified merchant category codes (MCCs).
| Category | Per-Transaction Limit | 24-Hour Aggregate / Notes |
|---|---|---|
| Capital Markets (e.g., mutual funds, broking) | ₹ 5 lakh | ₹ 10 lakh |
| Insurance Premiums | ₹ 5 lakh | ₹ 10 lakh |
| Government e-Marketplace / Tax / Fees | ₹ 5 lakh | ₹ 10 lakh |
| Travel Bookings (MCC travel agencies/hotels) | ₹ 5 lakh | ₹ 10 lakh |
| Credit Card Bill Payments | ₹ 5 lakh | ₹ 6 lakh |
| Collections (loans/EMIs/B2B) | ₹ 5 lakh | ₹ 10 lakh |
| Jewellery Purchases | ₹ 2 lakh (or up to ₹5 lakh per some sources) | ₹ 6 lakh |
| FX Retail via BBPS / Digital Account Opening / Term Deposits | ₹ 5 lakh | ₹ 5 lakh |
| Initial Funding for Digital Account Opening | ₹ 2 lakh | ₹ 2 lakh |
Note: These higher limits apply only if you transact with a merchant verified under the new rules. Banks or PSPs may still set lower caps into their policies.
Tip: Before making a large payment, check if the merchant is listed under the correct MCC and is verified to qualify for the higher limit.P2P Payments: What Still Doesn’t Change
While high-value merchant payments got a boost, peer-to-peer (P2P) UPI transfers remain under the existing cap — no change. If you’re sending money to a friend or family member (not a merchant), the limit stays at ₹ 1 lakh/day.
This distinction ensures that the higher limits focus on verified business flows rather than casual person-to-person transfers, which carry different risk profiles.
How to Check & Use the Higher Limits Safely
Here are practical steps to ensure you can make high-value UPI payments smoothly and securely:
- Verify merchant status: Confirm that the merchant is “verified” under NPCI category and the payment flow shows large-limit option.
- Check your app’s limit: Even though NPCI allows up to ₹ 5 lakh per transaction and ₹ 10 lakh daily for many categories, your bank or UPI app may enforce a lower “internal cap”.
- Choose correct payment option: Use UPI payment mode labelled for “merchant” not just “send money to friend”. P2M flow is key for higher limits.
- Divide if needed: If merchant isn’t verified for high-limit category, your transaction may fail — consider splitting or using alternative method like RTGS/NEFT.
- Stay alert to charges: Higher limits may come with extra verification – ensure your UPI PIN, app version and bank KYC are up-to-date.
With these changes, UPI is clearly positioned not just for everyday payments but also for large-ticket transactions — making it more versatile for users, businesses, and digital finance growth. Use the new limits smartly, confirm eligibility, and enjoy the benefit of higher-value UPI payments.
Frequently Asked Questions
1. Do the new UPI limits apply to all merchants?
No. They apply only to verified merchants in specific categories (MCCs) flagged by NPCI. Ordinary merchant flows may still operate under lower limits.
2. Can I send ₹5 lakh to my friend via UPI now?
No. The higher limits apply only to P2M transactions in specified categories. P2P transfers remain capped at ₹ 1 lakh/day.
3. When did these changes take effect?
The new limits became effective from 15 September 2025.
4. Can my bank restrict the limit further?
Yes. While NPCI sets the maximum ceiling, individual banks or UPI-apps may impose lower internal limits based on risk policy.
5. What happens if the transaction fails for a high amount?
It could be because the merchant isn’t verified under the new category, your bank has a lower cap, or you chose P2P instead of P2M. Always check merchant category and bank/app terms.