UPI Transaction Charges: Limit Per Day, Guidelines, Rules, and Key Details
The National Payments Corporation of India (NPCI) developed the Unified Payment Interface (UPI), a system that enables real-time money transfers between personal accounts, banks, and merchant accounts via mobile devices. It provides a seamless and instant way to make bank-to-bank payments, making online payments more convenient. UPI has become the most preferred payment system in India due to its ease of use and reliability.
What is a Prepaid Payment Instrument (PPI) in UPI?
A Prepaid Payment Instrument (PPI) in UPI refers to digital wallets that store funds, allowing individuals to make real-time online payments. These include wallets, smart cards, preloaded gift cards, vouchers, and magnetised chips.
- Transactions through PPIs occur when a wallet, such as PhonePe, is used to scan a UPI QR code.
- Common PPIs include Paytm wallet, Amazon Pay, SODEXO vouchers, and Freecharge wallet.
UPI Transaction Limit Per Day in 2025
The daily UPI transaction limit is determined by each bank within the UPI network and may differ from one bank to another. The standard UPI limit in 2025 is ₹1 lakh per day, as outlined by NPCI.
- Special transaction types can have higher limits:
- ₹2 lakh for capital markets, insurance, collections, and foreign inward remittances.
- ₹5 lakh for payments related to tax, educational institutions, hospitals, IPOs, and RBI Retail Direct schemes.
Individual banks may set their limits, ranging from ₹25,000 to ₹1 lakh per day, or apply weekly or monthly limits.
Bank-specific UPI limits are as follows:
- Bank of Baroda: Not Set
- PNB: ₹50,000
- SBI, Canara Bank: ₹1,00,000
- Union Bank of India: ₹2,00,000
- ICICI Bank: ₹10,000–₹25,000 on Google Pay
- Other banks: ₹1,00,000
UPI Transaction Limit Per Week
Some banks set weekly UPI limits, which also vary across institutions.
- For example, IDFC Bank sets the weekly transaction limit at ₹1,00,000.
UPI Transaction Limit Per Month
A few banks have implemented monthly UPI transaction limits.
- IDFC Bank has a monthly limit of ₹30,00,000.
Surcharge/Interchange Fee on UPI Payment
When UPI transactions are processed through PPIs (e.g., wallets), an interchange fee is applied. This fee covers costs related to processing, accepting, and authorizing transactions.
- Interchange fee ranges from 0.5% to 1.1%, depending on the service:
- 0.5%: Fuel payments
- 0.7%: Post office, telecom, utilities, agriculture, education
- 0.9%: Supermarkets
- 1%: Insurance, mutual funds, government services, railways
UPI New Guidelines
New rules stipulate an interchange fee of up to 1.1% on UPI transactions above ₹2,000 made through PPIs, effective from 2024.
Will Customers Have to Pay the Interchange Fee on UPI Payments Made Via Wallets?
Customers will not be charged interchange fees for Peer to Peer (P2P) and Peer to Merchant (P2M) transactions, even if the payment is made via a wallet.
- P2P transactions involve transferring funds between two individuals.
- P2M transactions involve paying merchants for goods and services.
The merchant (business or person receiving payment) pays the interchange fee to the payer’s bank when wallets are used for merchant payments.
How Much UPI Transactions Will Be Free?
Personal transactions via UPI remain free of charge.
- However, transactions above ₹2,000 via PPIs incur interchange fees, which are the responsibility of the merchant.
Are UPI Payments Free or Chargeable?
There are no extra charges for making UPI payments for personal transactions.
- Digital wallet payments above ₹2,000 may incur interchange fees, but customers do not pay these fees—merchants are liable to cover the cost.
Who Will Pay the Interchange Fees?
Merchants are responsible for paying the interchange fees.
- Small shopkeepers are not impacted by these charges.
- Medium shopkeepers will incur interchange fees on transactions exceeding ₹2,000, but they may choose whether to absorb the cost or pass it on to customers.
Wallet issuers must also pay wallet-loading service charges of 15 basis points for recharges over ₹2,000. For example, PhonePe will pay a 0.15% service charge to the remitter bank when recharging wallets.
In conclusion, while UPI transactions remain cost-free for personal payments, merchants will bear the fees for larger transactions made through digital wallets.
