What is UPI Lite and How to Set it Up on the BHIM App?
Reserve Bank of India Governor Shaktikanta Das launched three key initiatives at the Global Fintech Fest 2022 in Mumbai – RuPay Credit Card on UPI, UPI LITE, and Bharat BillPay Cross-Border Bill Payments.
Read on as we discuss a few key details about UPI Lite.
What is UPI Lite?
UPI Lite is an on-device wallet feature that will allow users to make real-time small-value payments of up to Rs. 200 without using a UPI PIN, The Economic Times reported Wednesday. At present, only debit from your wallet is permitted and all credits to UPI Lite including refunds will directly go to your bank account, the report added.
With UPI Lite enabled on the BHIM app, users will be able to make small-value transactions in a near-offline mode, the National Payments Corporation of India (NPCI) stated in a press release Tuesday.
Features of UPI Lite
Here are some of the features of UPI Lite:
- Transaction limit of up to Rs.200
- Users can add up to Rs.2,000 to the UPI Lite app balance
- Users won’t need to enter UPI PIN to carry out transactions
- You can use your bank account to add money to UPI Lite
- Currently, only the BHIM app offers UPI Lite
- You can check your UPI Lite balance vis SMS but not on the app
How does UPI Lite Work?
Customers will have to add funds from their bank accounts to the wallet on the app to use UPI Lite. As it is an ‘on-device wallet’, the users do not require the internet for a real-time payment, the Economic Times report further stated.
The ET report quoting NPCI added, “Do remember that you will be able to add funds on the UPI Lite wallet only in online mode with additional factor authentication (AFA) or using UPI AutoPay which has been registered by the user in online mode with AFA. In case you disable UPI Lite, the unutilised balance will be credited to your bank account”.
The NPCI had earlier stated, “In phase one, UPI Lite will process transactions in near offline mode, i.e., debit (payments) can be made without internet connection and credits into the account will be done online…However, there is a plan to make UPI Lite offline in the future where customers can process transactions — both debit and credit — in complete offline mode”.
How to Enable UPI Lite on the BHIM App
Follow these steps to enable UPI Lite on the BHIM app:
Step 1: Go to Play Store or App Store and instal the BHIM app
Step 2: Add your bank account and log in using your bank details
Step 3: Click on the UPI Lite banner
Step 4: Select the ‘Enable Now’ button to activate UPI Lite
Step 5: Now you will be able to add up to Rs.2,000 on your UPI Lite wallet
Step 6: Enter your UPI PIN to activate (you won’t need to enter your UPI PIN during transactions)
What are the Total Transaction Limits on UPI Lite?
The upper limit of a UPI Lite payment transaction will be Rs. 200 while the total limit of UPI Lite balance for an on-device wallet will be Rs. 2,000 at any point in time, the NPCI press release further stated.
What is the Difference Between UPI and UPI Lite?
Let’s look at the table below to understand the difference between UPI and UPI Lite
| UPI | UPI Lite |
| It’s a 24/7 instant payment service that allows you to make money transfers between banks | It’s an ‘on-device wallet’ that allows you to make small payments |
| Transaction limit is set to Rs.2 lakh | Transaction limit is set to Rs.200 |
| You need an internet connection to carry out transactions | Currently, you can make payments in a near-offline mode |
| A 4 to 6-digit PIN is mandatory | Currently, you don’t need any PIN to make payments via UPI Lite |
| Customers of more than 100 banks using apps like BHIM, PhonePe, GooglePay, Paytm and other mobile banking apps can use UPI | UPI Lite is currently available only on the BHIM app. Currently, customers of only 8 banks can use it |
Who can Use UPI Lite Now?
For now, customers of Canara Bank, HDFC Bank, Indian Bank, Kotak Mahindra Bank, Punjab National Bank, State Bank of India, Union Bank of India and Utkarsh Small Finance Bank would be able to use UPI Lite digital payment system on the BHIM app, the Mint reported, quoting the NPCI press release.
How should Users Check UPI Lite Transaction History?
UPI Lite transactions, except top-ups, will not be displayed in your bank account statement or passbook. Customers will receive an SMS daily containing the history of UPI Lite transactions carried out during the day, from the bank, The Economic Times report quoted NPCI.
“Any disputes pertaining to enablement, top up or disablement of UPI Lite shall be referred to and handled by issuing bank,” as per the NPCI website.
How will UPI Lite Benefit the Users?
UPI Lite will provide users with a convenient solution for faster and simpler low-value transactions. At present, India is thriving on low-value UPI payments with 50% of transactions through UPI below Rs.200, the NPCI press release stated.
“UPI Lite will reduce the debit load on the core banking system, thereby improving the success rate of transactions further, enhancing the user experience, and taking us one step closer to processing a billion transactions a day on the UPI platform” – NPCI
Together, RuPay Credit Card on UPI, UPI LITE, and Bharat BillPay Cross-Border Bill Payments initiatives give the potential to revolutionise the digital payments ecosystem.
This could also help extend the reach of digital payments to many new users across India and abroad and aid the journey of onboarding the next 300 million users on digital payments, the NPCI press release concluded.
Final Word
The introduction of UPI Lite could mean more consumers using the platform for online transactions. The wallet aims to facilitate small-value transactions in a near-offline mode without using a UPI PIN.
Would you be interested in using UPI Lite for daily transactions? Let us know in the comment section. For more tidbits from the world of personal finance, follow #TrendingNow.
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