The Unified Payments Interface (UPI) is gearing up to expand its user base with the introduction of UPI Circle, a new feature designed to simplify delegated payments within households. This innovative addition aims to enhance the versatility of UPI, allowing multiple family members to manage transactions from a single account.
What is UPI Circle?
UPI Circle allows a primary user to authorise secondary users, such as family members or trusted individuals, to make transactions from their UPI-linked account. This feature includes two options: either approving each transaction individually or setting a transaction limit of up to Rs 15,000 that can be processed without additional approval.
Testing and Rollout
Major payment platforms including Amazon Pay, Google Pay, and NPCI’s Bharat Interface for Money (Bhim) are currently testing UPI Circle within closed user groups. The feature is expected to go live in the coming months. PhonePe, the leading third-party UPI application, is also conducting trials.
NPCI officially unveiled UPI Circle at the Global Fintech Fest in Mumbai last week, highlighting its potential benefits for various use cases.
Use Cases and Benefits
UPI Circle is particularly useful for households with a single bank account, enabling smooth transactions for family members such as children, elderly parents, or household staff. For example, students can make cash-free payments using their parents’ UPI accounts, while housemaids and drivers can handle expenses on behalf of their employers.
Vikas Bansal, CEO of Amazon Pay, emphasised that UPI Circle can provide substantial convenience for users and is expected to activate a significant number of new UPI users.
Security and Adoption
The feature also addresses security concerns by keeping control with the primary account holder, reducing the risks associated with digital payment fraud and the vulnerability of children and elderly family members. Industry insiders anticipate that the requirement for transaction authentication will promote wider adoption.
Future Prospects
NPCI’s focus on expanding the UPI user base, particularly among young and elderly consumers, aims to push the active user count beyond 300 million. Google, in a recent blog post, highlighted UPI Circle’s role in advancing a more inclusive and convenient financial ecosystem.
With UPI Circle, UPI is set to enhance its appeal and functionality, making digital payments more accessible and manageable for a diverse range of users.
