UPI Lite - Mindgate Solutions Private Limited

Retail Payments

UPI Lite

The growth of the digital payments industry in India has been commendable. Various digital products and emerging use cases such as UPI solutions, NETC Fastag, digital wallets, etc. continue to make inroads and garner the support of the Indian customers.

UPI is one of the most popular online payment platforms that continue to dominate the digital payment space in the country. According to the latest reports, UPI holds over 90% market share in overall mobile payments and over 55% (volume-wise) in person-to-merchant payments. Factors like convenience, faster transactions, and practical security features, have made UPI payment a preferred choice of many.

Whether it’s about paying utility bills, mobile phone bills or buying goods on e-commerce platforms, the UPI platform has turned into a preferred payment method for the consumers.

The immense popularity and faster adoption of UPI payments have put a significant burden on bank’s core systems. To ease the load on the bank’s core system, RBI and NPCI has launched a new product on UPI rails called UPI Lite, that will process low-value transactions (below INR 200) without routing them to the bank’s core system, such low-value transaction today contributes to more than 50% of total volume processed.

Key Highlights:

  • UPI Lite is designed as an ‘on-device wallet’ for processing low-value transactions. It will initially target transactions of ₹200 or less.
  • All the users of UPI will have the option to enable UPI Lite called “On-Device wallet” on their UPI app itself.
  • The users will have to allocate funds from their bank accounts to the UPI-Lite wallet, the UPI Lite balance limit is set to ₹2,000 for now by NPCI.
  • While UPI Lite low-value payments will process without the additional factor authentication (AFA), to top up funds in UPI Lite users will need to enter AFA or use UPI AutoPay.