The Reserve Bank of India (RBI) has proposed a fresh concept to launch a useful service for users of UPI Lite. The objective of this programme is to expedite digital payments of small value and promote broader usage of this streamlined Unified Payments Interface (UPI).
What is UPI Lite Wallet?
The UPI Lite wallet, which is intended for quick and simple small-value transactions, has a daily limitation of Rs 2,000 and a Rs 500 individual payment cap. On the other hand, RBI Governor Shaktikanta Das revealed intentions to incorporate an auto-replenishment mechanism into the UPI Lite architecture in order to enable more seamless transactions.
Benefits of Auto-Replenish for UPI Lite
Enhancing Convenience
Customers can choose to have their UPI Lite wallets automatically refilled under this proposed approach, provided that the amount falls below a predefined threshold that they have chosen. This initiative has the potential to enhance the ease with which it is to make small-value digital payments.
Expanding the E-Mandate Framework
According to the RBI’s proposal, the e-mandate framework would also encompass some recurring payment operations like Fastag and replenishment of National Common Mobility Card (NCMC) balances. Customers can benefit from increased simplicity in handling their travel and mobility-related payments by integrating these transactions—which don’t have a set periodicity—into the electronic mandate system.
Fostering Adoption and Convenience
UPI Lite has acted as a driver for simple, rapid, and on-device wallet small-value payments since its launch in September 2022. The RBI hopes to increase the use of digital payments by giving consumers more convenience and control over their financial transactions through the launch of the auto-replenishment function and the extension of the e-mandate framework.
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