‘Can pay ₹5 lakh in taxes via UPI soon’
- The Reserve Bank of India has decided to enhance the limit for tax payments via UPI from ₹1 lakh to ₹5 lakh per transaction
Highlights:
- As direct and indirect tax payments are common, regular and high value, it has been decided to enhance the limit for tax payments through UPI from ₹1 lakh to ₹5 lakh per transaction.
- The RBI is also provisioning to introduce ‘Delegated Payments’ through UPI.
- This will enable a secondary user, like a spouse, to make payments via UPI by using the bank account of the primary user.
- Delegated Payments would enable a UPI user to set a payment limit for another user on their bank account.
- This product is expected to add to the reach of digital payments and would add to the 424 million individual user base
- UPI has become the most-preferred mode of payments. Currently, the transaction limit for UPI is capped at ₹1 lakh.
- Based on the various use-cases, the Reserve Bank has periodically reviewed and enhanced the limits for a few categories like capital markets, IPO subscriptions, loan collections, insurance, medical and educational services etc
- The Unified Payments Interface (UPI) has a very large user base.
- There is, however, potential for expansion
Prelims Takeaway
- UPI
- Delegated payments