UPI has transformed money transfers in India—making payments quick, simple and widely accepted, from small grocery shops to online purchases. Yet many users still have questions about UPI charges, daily limits and any potential hidden costs. What is the daily cap? Are there fees if you exceed it? And what do recent rule changes mean for your transfers?
This guide explains UPI payment charges, limits and fees in clear terms. It includes the full list of UPI transaction charges where applicable, and outlines how the latest rules from the National Payments Corporation of India (NPCI) affect everyday transfers in 2026.
UPI Transaction Limit Per Day in 2026
As of 2026, the standard UPI transaction limit per day is ₹1 lakh, following NPCI guidelines. NPCI has, however, raised limits for specific categories to facilitate high-value digital payments. Under the updated rules effective from 15 September 2025, selected categories can have daily UPI limits up to ₹5 lakh, and in certain authorized cases up to ₹10 lakh depending on the payment type and authorisation.
Summary of updated daily limits by category:
| Category | Previous Limit | New Limit (from Sept 2025) |
|---|---|---|
| Travel bookings | ₹1 lakh | ₹5 lakh |
| Insurance payments | ₹2 lakh | ₹5 lakh |
| IPO or RBI Retail Direct investments | ₹5 lakh | ₹5 lakh |
| Government payments (tax/EMD) | ₹1 lakh | ₹5 lakh |
| Loan collections and EMIs | ₹2 lakh | ₹5 lakh |
For most users the ₹1 lakh cap remains the standard. Banks can set their own daily or monthly limits within NPCI’s framework, so individual limits may vary. Typical bank-wise daily limits for popular banks look like this:
| Bank Name | UPI Daily Limit |
|---|---|
| State Bank of India (SBI) | ₹1,00,000 |
| HDFC Bank | ₹1,00,000 |
| ICICI Bank | ₹1,00,000 |
| Axis Bank | ₹1,00,000 |
| IDFC FIRST Bank | ₹1,00,000 |
Some banks may apply lower limits for security or account type reasons. Contact your bank or check your UPI app settings to confirm the exact per-day and per-transaction limits on your account.
UPI Transaction Limit Per Week
Beyond daily caps, many banks also enforce weekly or monthly ceilings for UPI activity. These internal limits help banks manage security, transaction volumes and customer behaviour. Weekly limits vary by bank and account profile and reset automatically once the period ends. Even with these caps, UPI remains free for regular users for routine transactions.
Are UPI Transactions Free?
Yes—basic UPI transactions are free. Sending money, receiving funds and paying merchants from a bank account via UPI apps like PhonePe, Google Pay or Paytm typically attracts no charge. Scanning QR codes, splitting bills or performing peer-to-peer transfers from bank accounts are all cost-free for users in normal situations. Charges only apply in specific, limited cases described below.
When Do UPI Transaction Charges Apply?
Most UPI payments do not incur charges. Exceptions include certain wallet-based merchant payments and service fees applied by payment platforms in select situations:
- Wallet payments above ₹2,000: Merchant payments made via prepaid wallets may attract an interchange fee charged to the merchant. This fee is not billed to the customer.
- Credit card wallet top-ups: Using a credit card to add money to a wallet can lead the wallet provider to levy a service fee.
- GST on platform fees: Some apps may charge GST on platform fees applied when using a credit card to top up a wallet. That GST is part of the service charge, not a tax on UPI itself.
- Wallet app terms: Certain wallet services may charge for premium features or for transfers that exceed free limits within their specific terms.
For the majority of users, UPI transfers remain free regardless of daily usage.
What is the Interchange Fee?
The interchange fee is a small charge associated with wallet-based merchant payments. It helps cover processing and settlement costs borne by wallet providers and supports safe, scalable digital payments. Important points about this fee:
- Purpose: Covers backend costs such as payment routing, settlement and fraud prevention for wallet-to-merchant transactions.
- Application: Applies only when a merchant is paid using a prepaid wallet. Direct bank-to-bank UPI transfers remain free for customers.
- Fee range: Typically ranges between 0.5% and 1.1%, depending on merchant category and service type.
Typical interchange fees by merchant category:
| Merchant Category | Interchange Fee |
|---|---|
| Fuel stations | 0.5% |
| Supermarkets / Grocery | 0.9% |
| Insurance premiums | 1.0% |
| Mutual fund transactions | 1.0% |
| Utilities | 0.7% |
| Education | 0.7% |
| Railways | 1.0% |
| All other merchants | 1.1% |
These interchange fees are paid by the merchant to the wallet provider and do not require any additional payment from customers.
Who Pays the Interchange Fee?
Merchants pay the interchange fee. The fee is deducted during settlement and helps wallet providers cover operational expenses related to processing payments.
Do Customers Have to Pay It?
No. Customers are not charged interchange fees. UPI transaction charges listed for merchant categories apply only to merchant settlements when payments are routed through PPIs (prepaid payment instruments). Direct bank-to-bank UPI transfers remain free for users.
What Is a Prepaid Payment Instrument (PPI) in UPI?
A Prepaid Payment Instrument (PPI) is essentially a digital wallet that you pre-load with funds and use for payments. Examples include the wallet balances many apps offer. Unlike regular UPI, which debits your bank account directly, a PPI uses a stored balance to make payments. PPIs are regulated by the RBI and can be provided by banks or non-bank entities. For everyday use, they function like other digital payment methods and are widely accepted.
What Is the New Rule on UPI Transaction Charges?
From 3 November 2025, NPCI adjusted UPI settlement rules so authorised and disputed transactions are settled separately to improve speed and accuracy. Previously both were processed together across 10 daily cycles. Now authorised transactions continue across 10 cycles, while dispute-related settlements run twice daily in two dedicated dispute cycles. This change aims to speed up settlements and reduce processing delays; other operational aspects—including timing, GST treatment and reporting—remain intact.
| Cycle | Time | Type |
|---|---|---|
| I | 9 am – Midnight | Authorised |
| II | Midnight – 5 am | Authorised |
| III | 5 am – 7 am | Authorised |
| IV | 7 am – 9 am | Authorised |
| V | 9 am – 11 am | Authorised |
| VI | 11 am – 1 pm | Authorised |
| VII | 1 pm – 3 pm | Authorised |
| VIII | 3 pm – 5 pm | Authorised |
| IX | 5 pm – 7 pm | Authorised |
| X | 7 pm – 9 pm | Authorised |
| DC1 | Midnight – 4 pm | Dispute |
| DC2 | 4 pm – Midnight | Dispute |
UPI Operational Guidelines
Key operational rules that govern UPI:
- Daily transaction limit: ₹1 lakh per day for most users; select categories can have higher caps up to ₹5 lakh or more under NPCI rules.
- Single transaction limit: Typically capped at ₹1 lakh, with higher allowances for eligible categories.
- Minimum transaction amount: ₹1.
- Number of transactions: Many banks permit up to 20 UPI transactions per day, though this varies by bank.
- UPI PIN required: Each transaction requires authentication with your UPI PIN for security.
- Bank account linking: Multiple bank accounts can be linked to one UPI app, but only one can be set as the primary for transactions at a time.
- PPI wallet payments: Interchange fees apply to merchant payments made through wallets above ₹2,000; direct bank transfers are not charged.
- Failed transactions: Failed payments are auto-reversed generally within 24 to 48 hours per RBI turnaround guidelines.
- Dispute settlements: Disputes are processed in two dedicated cycles daily since November 2025 to accelerate resolution.
- Regulatory oversight: NPCI operates UPI under the regulatory framework set by the Reserve Bank of India (RBI).
For regular users, UPI continues to be fast, secure and free for everyday transactions. If you frequently make high-value payments, check your bank’s limits and policies to ensure smooth processing.
FAQs on UPI Transaction Charges
1. Is there any charge on a UPI transaction?
No. Standard UPI transactions between bank accounts are free. Banks may have internal limits that vary, but there is no routine transaction fee for users.
2. How many UPI transactions are free?
All bank-to-bank UPI transactions are free for users. The interchange fee applies only to merchants when payments are routed through prepaid wallets and typically for payments above ₹2,000. That merchant fee does not affect users directly.
3. What is the new rule charge for UPI?
The recent rule clarifies settlement cycles and the merchant interchange fee for wallet-based payments. A fee (up to around 1.1% for some merchant categories) may apply to wallets paying merchants, but this is charged to the merchant, not the customer. Regular bank account UPI transfers are unaffected.
4. What is the limit of UPI per day?
The default per-day UPI limit is ₹1 lakh for most users. NPCI authorises higher limits—typically up to ₹5 lakh—for specific categories such as travel bookings, insurance payments, government fees and loan-related payments. Individual banks may set their own limits within NPCI guidelines.
5. Is there tax on a UPI transaction?
No direct tax is levied on standard UPI transfers for users. If you use a credit card to top up a wallet, the wallet provider may apply GST on any platform/service fee. That GST is part of the service charge from the app, not a tax on the UPI transfer itself.