By Bharat Tone News Desk | Published: August 1, 2025

The National Payments Corporation of India (NPCI) has rolled out significant updates to the Unified Payments Interface (UPI) system, effective from August 1, 2025. These changes aim to enhance the efficiency, security, and reliability of digital transactions across popular platforms like Google Pay, PhonePe, Paytm, and others. With UPI processing over 16 billion transactions monthly, these reforms address system strain, reduce outages, and bolster fraud prevention. Here’s a comprehensive breakdown of the new rules and their impact on users.

Key Changes to UPI Rules

1. Cap on Balance Checks: 50 Times Per Day Per App

UPI users can now check their bank balance only 50 times a day per app. This restriction aims to reduce unnecessary API calls that overload servers during peak hours, which NPCI identifies as a primary cause of transaction delays and outages. For most casual users, this limit is unlikely to pose an issue, but heavy users—such as small business owners, freelancers, or e-commerce sellers—may need to adjust their habits. To compensate, banks are now mandated to display the available account balance after every successful UPI transaction, reducing the need for manual checks.

2. Auto-Payments Restricted to Non-Peak Hours

Recurring payments, such as EMIs, OTT subscriptions, mutual fund SIPs, or utility bills, will now be processed only during specific non-peak time slots: before 10:00 AM, between 1:00 PM and 5:00 PM, and after 9:30 PM. This change is designed to ease network congestion during high-traffic periods (10:00 AM to 1:00 PM and 5:00 PM to 9:30 PM), ensuring smoother transaction processing. Users should schedule their auto-payments to align with these windows to avoid delays.

3. Recipient Name Visibility for Fraud Prevention

To combat fraud and prevent accidental transfers, UPI apps are now required to display the recipient’s registered bank name before a transaction is confirmed. This feature, effective since June 30, 2025, ensures users can verify the payee’s identity, reducing errors caused by misleading or similar names. For example, the verified name from the bank’s Core Banking System (CBS) will be shown, eliminating confusion from user-defined names or QR code discrepancies. This is a significant step toward safer digital payments.

4. Limits on Transaction Status Checks

Users can now check the status of a pending transaction only three times, with a mandatory 90-second gap between attempts. This rule addresses excessive status refresh requests, which NPCI identified as a major contributor to system slowdowns, especially during outages in April and May 2025. Additionally, payment status updates will now be provided within seconds, reducing uncertainty for users waiting to confirm whether funds have been credited.

5. Cap on Linked Account Views

Fetching details of bank accounts linked to a UPI profile is now limited to 25 times per day per app. This restriction helps reduce backend pressure on servers, ensuring smoother performance for all users. Like the balance check limit, this applies individually to each UPI app, so users with multiple apps can still access this feature separately on each platform.

6. Chargeback Limits

NPCI has set a cap on payment reversal requests (chargebacks) at 10 per 30 days, with a maximum of five per sender. This prevents misuse of the chargeback system while maintaining efficiency. Users are advised to verify recipient details carefully to avoid exhausting this limit.

7. Stricter API Monitoring and Penalties

NPCI has introduced stricter oversight of API usage by banks and payment service providers (PSPs). Excessive or inappropriate API calls, whether user-initiated or system-driven, will be monitored, and non-compliant apps or banks may face penalties, restricted API access, or suspension of new customer onboarding. These measures ensure the UPI ecosystem remains stable and scalable.

Why These Changes?

The UPI system has seen exponential growth, handling over 16 billion transactions monthly, but this has led to challenges like server slowdowns and outages, particularly during peak hours. NPCI’s new rules aim to:

• Reduce System Load: Limiting balance checks, account views, and status inquiries prevents excessive API calls that strain servers.
• Enhance Security: Displaying verified recipient names curbs fraud and accidental transfers.
• Improve Efficiency: Faster transaction status updates and scheduled auto-payments minimize delays and improve user experience.
• Ensure Scalability: These reforms lay the groundwork for future innovations, such as biometric authentication, which may replace PINs for UPI payments starting August 31, 2025.

Impact on Users

For casual users, these changes are unlikely to disrupt daily transactions, as most won’t hit the 50 balance check or 25 account view limits. However, heavy users, such as merchants or those managing multiple accounts, should:

• Plan auto-payments within the designated time slots.
• Verify recipient names before confirming transactions.
• Limit unnecessary balance checks and status inquiries to avoid temporary blocks.
• Keep apps updated to ensure compliance with the new rules, which will be rolled out automatically by PSPs.

Transaction Limits Unchanged

The daily UPI transaction limit remains ₹1 lakh for most cases, with up to ₹5 lakh for specific sectors like healthcare and education. Users can still perform up to 20 transactions daily within this cap. No new charges have been introduced for customers, though merchants may face interchange fees (0.5-1.1%) for certain transactions, similar to credit card merchant discount rates.

Looking Ahead

These updates mark a significant step in strengthening India’s digital payment ecosystem. NPCI is also exploring biometric authentication for UPI payments, which could eliminate PINs and further simplify transactions. Additionally, starting August 31, 2025, users may access pre-approved credit lines (secured by assets like gold or property) for UPI payments, blending formal credit with UPI’s convenience.

Conclusion

The new UPI rules effective August 1, 2025, reflect NPCI’s commitment to making digital payments faster, safer, and more reliable. While the changes may require minor adjustments for some users, they are designed to enhance the overall experience and ensure UPI’s scalability as India’s leading payment platform. Stay informed, verify recipient details, and align auto-payments with the new schedule to make the most of these updates.

For more updates on digital payments and financial news, visit www.bharattone.com.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. Users should verify details with their UPI app providers and banks.