Priya is a single working mother who constantly juggles between managing her home and work. Her teenage daughter, Riya, often needs small amounts of money for school projects, outings with friends, or online purchases. Every time Riya needs money, she has to call her mother, who transfers the required amount from her bank account. It is a tedious process for both, especially when Priya is caught up in meetings or work commitments. This is where NPCI’s new “UPI Circle” feature steps in, offering a solution that brings ease and convenience to such everyday financial tasks.

Also Read: How To Effectively Plan For Healthcare Costs After Retirement?

The National Payments Corporation of India (NPCI) has launched a new feature on its Unified Payments Interface (UPI) platform called “UPI Circle”. This innovative feature is designed to make online payments more accessible and convenient, particularly for groups of users who may not all have their own bank accounts or UPI access.

What is UPI Circle?

UPI Circle is a feature that enables UPI users to act as primary users, linking with trusted secondary users on the UPI App for either partial or full delegation of payments.

In full delegation, the primary user authorises a trusted secondary user to initiate and complete UPI transactions as per defined spend limits. In partial delegation, the primary user authorises the initiation of payment requests from secondary users. The primary user then completes the UPI transaction with a UPI PIN.

How many delegations can be made?

A primary user can delegate to up to 5 secondary users, and a secondary user can accept delegation from only one primary user.

What are the limits?

Full delegation allows a maximum monthly limit of Rs 15,000 per delegation and a maximum per transaction limit of Rs 5,000. Existing UPI limits shall be applicable in case of partial delegation.

For Parent providing expenses to their Kids

In Priya’s case, UPI Circle would enable her to allow Riya to make payments directly from her account within a pre-defined limit. This means that instead of constantly transferring money, Priya can set a monthly spending limit for Riya, who can manage her small expenses independently. The control remains with Priya, as she can monitor transactions and adjust limits as needed.

“UPI Circle will allow users to create closed-payment groups, facilitating seamless and instant peer-to-peer and peer-to-merchant transactions within trusted circles like families, friends, or small businesses. This innovation will not only drive convenience but also enhance security by reducing the risk of fraud within these trusted ecosystems,” says Ajay Rajan, Country Head – Government, Multinational & International Business, Transaction Banking & Knowledge Units, YES BANK.

“Additionally, UPI Circle can be leveraged for creating micro-communities within gig economies or collaborative platforms, where members can easily settle payments or pool resources in real-time,” he adds.

Also Read: A-Nishchit Index 2024: Most Indians Expect Greater Financial Uncertainty, Unsure Of Future Well-Being, Says Survey

Convenience for the Senior Citizenry

Before UPI Circle, digital payments were often restricted to individuals with their own bank accounts and UPI setups. However, this new feature breaks down that barrier by introducing the concept of delegated payments.

Picture an elderly couple, Rishi and Sulekha, who find navigating the complexities of online banking challenging. With UPI Circle, they can delegate their payment tasks to their tech-savvy son, Raj, who lives in another city. With UPI Circle, Raj can manage his utility bills, medical expenses, and other financial needs remotely, ensuring that his parents’ finances are well taken care of without having to handle digital transactions directly.

Security and Trust

Security in digital payments is a paramount concern, and UPI Circle addresses this with robust measures. For instance, while Priya can trust Riya with a spending limit, she can also rest assured that every transaction is secured by an app passcode or biometric verification, like fingerprint or face recognition. This prevents unauthorised access, even if Riya’s phone is lost or compromised.

NPCI notes that around 6 per cent of UPI users make a large number of transactions mainly because they also make transactions on behalf of others. This feature will give primary users the same control while offering more convenience with delegated payments.