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RBI Introduces UPI Lite E-mandate For Seamless Transactions

On Friday, the Reserve Bank of India announced the introduction of the UPI LITE e-mandate to enhance the payment ecosystem’s seamlessness.

Introduced in September 2022, UPI Lite facilitates quick and seamless small-value payments via an on-device wallet.

Currently, UPI Lite has a daily transaction limit of Rs 2,000, with the maximum amount for a single payment set at Rs 500.

To encourage wider adoption of UPI Lite, the RBI proposed today to include it in the e-mandate framework by introducing a facility for customers to automatically replenish their UPI Lite wallets when the balance falls below a set threshold. This will further enhance the ease of making small-value digital payments.

Designed to handle low-value transactions below Rs 500, UPI LITE uses the reliable NPCI Common Library (CL) application to process payments. It integrates seamlessly with the existing UPI ecosystem on mobile phones, ensuring consistency, compliance, and broad acceptance.

UPI LITE provides a user-friendly experience for small transactions by bypassing the need for real-time processing through the remitter bank’s core banking systems, while still maintaining adequate risk mitigation.

The RBI decided to keep the policy rate unchanged for the eighth consecutive time, stating it would maintain a close watch on inflation.

The RBI also raised the threshold for bulk deposits in banks to Rs 3 crore, up from Rs 2 crore.

The RBI announced plans to take additional steps to moderate unsecured loans and advances.

It noted that a few regulated entities still charge certain fees without proper disclosures.