Beginning August 1, 2025, major changes to India’s Unified Payments Interface (UPI) system will be implemented as part of the National Payments Corporation of India’s (NPCI) effort to improve digital transaction efficiency, security, and infrastructure reliability. With over 10 billion monthly transactions processed through UPI, these updates will impact daily financial behaviour for millions of users.
The changes, which target everything from balance inquiry limits and autopay schedules to future biometric payment integration, are aimed at reducing system strain and promoting secure, scalable usage of India’s leading digital payment platform.
1. Daily limit on balance enquiries introduced
One of the key reforms is the imposition of a 50-per-day cap on account balance checks per UPI app. After hitting this limit, further requests to check balances will be blocked for the day.
This change is meant to reduce API overload during peak hours. Excessive balance checks were slowing down UPI transaction processing and impacting reliability. To ensure transparency, NPCI has also made it mandatory for issuer banks to display the available balance in the payment confirmation message after every successful transaction.
Additionally, users will be allowed to fetch linked bank account details (via mobile number) only 25 times per day. These steps are expected to ease backend pressure on servers significantly.
2. New time slots for auto-pay transactions
Another crucial update involves restricting the time window for autopay executions such as subscription payments, SIPs, EMI deductions, and bill payments.
These recurring payments will now be processed only during non-peak hours: Before 10:00 AM, between 1:00 PM and 5:00 PM, after 9:30 PM
Previously, such auto-payments could occur at any time. NPCI said that this adjustment would reduce peak-hour congestion, ensure faster processing of real-time payments, and mitigate the risk of auto-pay exploits during busy periods.
3. Transaction status update mechanism to improve
NPCI is also upgrading its transaction status notification system to ensure users and merchants receive real-time updates faster.
This will help minimise confusion and waiting times during high-traffic periods. It also enhances trust, especially for businesses relying on immediate payment confirmation.
4. Cap on failed transaction status checks
To avoid system abuse, NPCI has restricted status check requests for failed or pending transactions:
- Only three retry attempts are allowed
- Each retry must be spaced at least 90 seconds apart
- If these conditions are not met, the system will block further requests for that transaction ID. This ensures system load remains optimised, particularly during nationwide high-traffic events or online sale periods.
5. Mandate execution attempts limited
For recurring mandates (e.g., EMIs or subscriptions), NPCI has capped attempts to four per mandate, further helping servers maintain efficiency.
6. Mandatory display of recipient name before payment
To avoid payment errors and prevent fraud, UPI apps must now display the recipient’s name before every transaction. This user-facing update will help individuals confirm the correct payee, reducing mistaken payments to the wrong contact or business.
7. UPI-powered credit lines with daily limits
Starting August 31, users will be able to use pre-approved credit lines (secured by gold, FDs, shares, or property) for UPI payments. This initiative merges formal credit access with the simplicity of UPI.
Limits for these services include:
- Rs 1 lakh per day for purchases
- Rs 10,000 per day for cash withdrawals
- 20 peer-to-peer (P2P) transfers per day
8. PSPs must reduce backend load during peak hours
Banks and Payment Service Providers (PSPs) have been instructed to:
- Track API request volume
- Restrict non-customer-initiated API calls during peak traffic windows
- Failure to implement changes by July 31, 2025 could result in penalties or even suspension from onboarding new customers, as per NPCI’s warning dated May 21, 2025.
9. Future of UPI: Biometric payments to replace PINs
In a major development, UPI may soon eliminate the need for PINs, allowing users to authenticate payments through biometric verification:
- Fingerprint scan
- Face ID
- Iris recognition
Here’s how it might work:
- Scan a merchant’s QR code.
- Choose biometric verification instead of entering a PIN.
- Confirm the transaction via fingerprint or facial recognition.
NPCI is actively testing this Aadhaar-linked feature. The system will keep biometric data encrypted and secure, accessible only with the user’s consent. This change is designed especially for the elderly, rural populations, and those with low literacy, making digital payments truly inclusive.
Motivation behind the changes
While the Rs 1 lakh transaction cap (Rs 5 lakh for select sectors) remains unchanged, the new rules mainly target heavy UPI users who inadvertently slow down the ecosystem by frequent status checks or balance enquiries.
By enforcing smarter limits, NPCI aims to:
- Protect consumers
- Enhance system stability
- Ensure fair resource distribution
- Encourage healthy competition among UPI apps
These updates also lay the foundation for scalable future growth, as India moves closer to its goal of a seamless, secure, and widely adopted digital payments network.
The new UPI regulations are a significant step in the evolution of India’s fintech landscape. With billions relying on UPI daily, these changes, though subtle for casual users, represent a larger shift toward efficiency, fairness, and innovation.
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