The decision to raise the limit aligns with the RBI's broader strategy to promote digital payments and reduce the reliance on cash...
Digital Desk: In a significant move aimed at enhancing digital payment capabilities, the Reserve Bank of India (RBI) on Thursday announced an increase in the upper limit for tax payments through the Unified Payments Interface (UPI). The limit has been raised to Rs 5 lakh per transaction, up from Rs 1 lakh. This move is expected to provide considerable convenience to taxpayers, especially for high-value transactions.
The decision to raise the limit aligns with the RBI's broader strategy to promote digital payments and reduce the reliance on cash. By enabling larger tax payments through UPI, the central bank aims to encourage more taxpayers to adopt digital methods for settling their tax liabilities.
The enhanced limit will simplify the payment process, allowing individuals to make larger payments in a single transaction, thus reducing the need for multiple payments.
The RBI has periodically reviewed and increased UPI transaction limits for various use cases, including capital markets, IPO subscriptions, loan collections, and payments for insurance, medical, and educational services. This latest increase in the tax payment limit reflects the central bank's commitment to expanding the utility of UPI.
In addition to raising the UPI limit, the RBI is also exploring the introduction of "Delegated Payments" through UPI. This new feature will allow a primary user to authorize another individual to make payments using their UPI account, potentially expanding the reach and usage of digital payments nationwide.
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