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NPCI imposes 30% cap for third-party apps offering UPI transactions from 1st January 2021

Bapun Raz

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National Payments Corporation of India (NPCI), which operates the Unified Payments Infrastructure (UPI), in the country, on Thursday said that it will issue a cap of 30% on transaction volume clocked by a player starting 2021.

The cap of 30% will be calculated on the total volume of transactions processed in UPI during the preceding three months.

According to NPCI, the decision has been taken in line to address the risks and protect the UPI ecosystem from frauds as it scales further.

NPCI to cap transaction volumes of UPI players
 

Bapun Raz

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U999X0D

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This will reduce initiatives (read. offers) like Go India Game being offered on Google Pay. This will level the playing field for all.

But the second point is contradicting. If a certain player (read Google Pay) exceeds the limit like it does everytime, how will the phased manner help?
 

kanagadeepan

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Looks like they want to avoid monopoly.

 

Endgame

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The cap of 30% will be calculated on the total volume of transactions processed in UPI during the preceding three months.
Couldn't understand bro, can you please elaborate with an example?
 

Esmail

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Couldn't understand bro, can you please elaborate with an example?
If during 1st June to 31st August a total of 1000 Crore rupees worth of transactions were done in India over UPI then from 1st to 30th September Google pay, Paytm, Phonepe, etc can only handle UPI transactions worth 300 Crore rupees each.
 
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Bapun Raz

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The new caps do not apply to Reliance's Jio Payments Bank, or to Paytm, because of their payments banking licenses and they do not fall into the "third-party apps" category.

Companies such as PhonePe and Google, which currently exceed NPCI's stipulated cap, will get two years to comply with the new rules.

30% UPI market share cap rule does not apply to Paytm, Jio; here's why

 

kanagadeepan

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I initially used phonePe. It never worked consistently plus has much higher failure rates and I thought the Nationalized bank was the culprit. But when I use Bhim for the same Ac, it worked flawlessly 50% of the time, when PhonePe was NOT working. BHIM is the backbone and its bare-bone structure may be boring and may not have cashback offers like others. But it fails only when the bank side server fails. Another bank a/c linked with pvt bank, has almost zero failures in BHIM. I have stopped using PhonePe and never tried GPay. If not obvious, BHIM can be used to pay PhonePe and GPay merchants or users as well.
 
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