The face of digital payments in India is about to change. From 1 April 2025, many significant changes are going to happen in Unified Payments Interface (UPI). These changes will not only affect common users, but will also affect large UPI platforms and credit card users like Google Pay, PhonePe.
The main objective of these changes is to make the UPI system more secure, efficient and user-friendly. The National Payments Corporation of India (NPCI) has decided to implement these rules to increase transparency in digital transactions and reduce fraud cases.
Let’s know about these changes in detail and understand how they will affect your daily digital transactions.
Upi changes from April 1, 2025: an observation
| shift | Description |
| Transaction ID format | Permission of alphanumeric characters only |
| UPI 123pay limit | ₹ 5,000 to ₹ 10,000 |
| Convenience fee | 0.5% to 1% + GST on some bill payments |
| Automatic charge process | Automated acceptance/rejection system |
| Mobile number verification | Weekly update compulsory by banks |
| Credit Card UPI Transaction | Fee on transactions of more than ₹ 2,000 |
| UP light transactions limit | ₹ 500 increased to ₹ 1,000 (proposed) |
| International UPI Transactions | Use of UPI during foreign trip |
Changes in UPI Transaction ID
NPCI has directed that from 1 April 2025 all UPI Transaction IDs will only use alphanumeric characters. This means that now special signs like @, #, $, % will not be used in Transaction ID.
- This change has been made to increase security and standardize the transaction process.
- The transaction will be automatically rejected by using special signs by any app.
- Users must ensure that they use only updated UPI apps.
Upi 123Pay limit increase
Feature phone is good news for users. The transaction limit of UPI 123Pay has been increased from ₹ 5,000 to ₹ 10,000.
- This change will benefit the feature phone users.
- Now they will be able to do transactions even without high price even without internet.
- This will expand the digital payment in rural areas.
Provision of Convenience Fee
Platforms like Google Pay, PhonePe and Paytm are now putting convenience fee on some bill payments.
- Electricity and debit card electricity, 0.5% to 1% + GST fee on gas bill payment.
- This fee is levied to charge the cost of the platform.
- Users are advised to get the fee information in advance.
Auto Chargeback Process improves
NPCI has implemented new rules to make the Chargeback process more efficient.
- Now the automatic acceptance/rejection system will be applicable.
- This will reduce the requirement of manual intervention.
- Transaction disputes will be rapidly disposed of.
New process of mobile number verification
Banks will now have to update mobile numbers in their database every week.
- Mandatory removing disconnected or surrendered numbers.
- This will reduce the chances of wrong transactions.
- Users are advised to keep the mobile number connected to their bank account updated.
Fee on Credit Card UPI transaction
Credit card UPI transactions of more than ₹ 2,000 will now be charged.
- This fee will be borne by traders.
- The rate of fee can be up to 1.1%.
- There will be no fee on personal transactions.
Possible increase in the limit of UPI Lite
RBI has proposed to increase the transaction limit of UPI Lite.
- The current limit can increase from ₹ 500 to ₹ 1,000.
- This will make the transactions of small value easier.
- UPI Lite can also be used in offline mode.
International UPI transaction facility
During the foreign trip, Indian citizens will now be able to use UPI.
- Initially this facility will be available in select countries.
- This will make foreign exchange transactions easier.
- Passengers will not need to carry additional cash.
Effect on google pay and phonePe
These changes will have the most impact on large UPI platforms like Google Pay and PhonePe.
- They have to update their system.
- According to the new rules, transaction id format will have to change.
- User satisfaction may be affected by applying convenience fee.
Credit card users impact
Credit card users may have to face some changes.
- Transactions of more than ₹ 2,000 may levy additional fees.
- This fee will be borne by the merchant, but it may eventually be burdened with customers.
- Users are advised to get the fee information before the transaction.
Upi positive effects of changes
These changes will strengthen the UPI system.
- Security will increase.
- The transaction process will be faster and efficient.
- There will be a decrease in cases of fraud.
- Digital payments will expand.
Precautions for users
In view of these changes, users should take some precautions:
- Always use the updated UPI app.
- Get the fee information before the transaction.
- Keep your mobile number updated from the bank account.
- Report any suspicious activity immediately.
- Maintain the privacy of UPI PIN.
What else can change in future?
The UPI system is constantly developing. Many more changes can be seen in the future:
- Detect fraud using AI and Ml.
- Integration of blockchain technology.
- Extensive use of biometric authentication.
- Cross-border UPI transaction facility.
- Start of voice-based UPI transactions.
conclusion
These changes, which come into force from 1 April 2025, will make the UPI system more secure, efficient and user-friendly. Although there may be some challenges in the beginning, these changes in the long run will strengthen India’s digital payment scenario. Users should be aware of these changes and take necessary precautions to protect their digital transactions.
Disclaimer
This article is only for informative purposes. Although we have tried to provide accurate information, the UPI rules and policies may change. Please consult your bank or financial advisor before taking any financial decision. Writer or publishers are not responsible for any error or omission.
