UPI, Digital Transactions: Authorities Extends Deadline for 30 % Cap

The Nationwide Funds Company of India (NPCI) on Friday prolonged the deadline for third occasion UPI gamers to fulfill its 30 % quantity cap in digital cost transactions by two years to end-December 2024.

The choice could present a reduction to 3rd occasion app suppliers (TPAP) like Google Pay and Walmart‘s PhonePe which have a majority share in UPI-based transactions.

NPCI runs the Unified Funds Interface (UPI) used for real-time funds between friends or at retailers’ finish whereas making purchases.

In November 2020, NPCI had introduced to restrict a single third occasion app to deal with solely 30 % of total UPI transaction volumes. The cap was to return in drive from January 1, 2021.

Nonetheless, the TPAPs (stay on November 5, 2020) which had been exceeding the cap got a interval of two years to adjust to the norms in a phased method.

“Considering the current utilization and future potential of UPI, and different related elements, the timelines for compliance of present TPAPs who’re exceeding the amount cap, is prolonged by two (2) years i.e. until December 31, 2024, to adjust to the amount cap,” NPCI said in a round.

NPCI additional mentioned that in view of serious potential of digital payments and the necessity for multi-fold penetration from its present state, it’s crucial that different present and new gamers (banks and non-banks) shall scale-up their shopper outreach for the expansion of UPI and obtain total market equilibrium.

TPAPs sometimes tie-up with banks on the back-end so as to add customers and course of funds for them. 

It was reported final month that the NPCI is planning to suggest the Reserve Financial institution to implement the sooner deadline of December 31, 2023, for limiting the amount cap of gamers to 30 %. It’s to be famous that presently there is no such thing as a quantity cap, resulting in Google Pay and PhonePe accounting for round 80 % of the full market share.