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Last updated on November 30th, 2022 at 10:40 pm


UPI has certainly replaced the requirement of carrying cash for most of us. It has been noticed that most of the transactions done through UPI are of small amounts.  RBI in association with NPCI launched the UPI LITE service on 20th September 2022 at Global Fintech Festival held in Mumbai. RBI has launched India’s own Digital Rupee.

What is UPI LITE?

UPI LITE is an on-device wallet feature that will allow users to make payments of smaller denominations.

UPI LITE Balance is an on-device virtual balance enabled by the user for performing transactions using UPI LITE.


Salient Features of UPI LITE

  • Only one bank account can be enabled for UPI LITE.
  • The upper limit of a transaction shall be Rs. 200/-
  • The upper limit of balance in UPI Lite shall be Rs. 2000/-
  • Bank will not pay interest on the balance set aside as a UPI LITE balance.
  • Only the top-up transaction will be displayed in the bank statement/passbook.
  • UPI LITE transactions shall not be displayed in bank statements/passbooks.
  • PIN or separate Authorisation will not be required to carry out a transaction with UPI LITE.
  • You will be sent one consolidated SMS once a day containing the history of transactions carried out through UPI LITE.

What costs do banks incur for processing a UPI transaction?



If Government wants UPI Lite to be successful then they need to make sure UPI payments below the denomination of Rs 200 are not allowed through the normal UPI app. If they continue to provide that facility free of cost like it is now, why would anyone shift to UPI Lite?

Even a transaction of an amount less than Rs 200 should not be allowed without the authorization of a PIN. With the advancement of technology, and ever-growing fraudsters, why should we remove a layer of security for convenience? Who will be held responsible for money transfers of smaller denominations through UPI Lite as no PIN is required?


The only benefit, I can see behind launching the UPI LITE is to bring down the settlement and processing cost for a successful UPI transaction.  As per an RBI release in early August 2022, it was clear that Central Government was bearing the burden of costs incurred for providing the UPI transaction free of cost to the end users.


CA Ankita Khetan
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Disclaimer: The above content is for general info purpose only and does not constitute professional advice. The author/ website will not be liable for any inaccurate / incomplete information and any reliance you place on the content is strictly at your risk.

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