The Indian government is considering implementing a minimum time delay for initial transactions between two users, particularly for amounts exceeding

Government introduce  Online Transaction To Someone May Take Four Hours above Rs. 2000 

 

The Indian government is considering implementing a minimum time delay for initial transactions between two users, particularly for amounts exceeding Rs 2,000. As per a report from Indian Express, officials are contemplating a four-hour window for the first transaction, covering various digital payment methods like Immediate Payment Service (IMPS), Real-Time Gross Settlement (RTGS), and Unified Payments Interface (UPI).

The objective is to enhance the security of digital transactions and address cybersecurity concerns. In contrast to existing practices that often limit the first transaction upon account creation, the proposed plan aims to regulate every initial transaction between two users, regardless of their transaction history.

Currently, when users set up a new UPI account, they are allowed to send a maximum of Rs 5,000 within the first 24 hours. Similarly, with National Electronic Funds Transfer (NEFT), following the activation of a beneficiary, Rs 50,000 (either in full or parts) can be transferred within the initial 24 hours. However, the new plan would enforce a four-hour time limit each time a user initiates their first payment exceeding Rs 2,000 to another user without a previous transaction history.

While this measure may introduce some friction to digital payments, officials argue that it is necessary to safeguard against cyber threats. The proposed delay is viewed as a safety net to deter cybercriminals and fraudsters from exploiting the speed and convenience of UPI transactions. Experts note that the growth of UPI is closely linked to the expansion of FinTech lending in India, emphasizing the need for robust measures to protect against cyber risks and fraud.

Jatinder Handoo, CEO of the Digital Lenders Association of India (DLAI), welcomed the move, stating that it is crucial to have credible deterrents in place to prevent misuse of the UPI's speed and convenience. The proposed four-hour delay aligns with efforts to enhance client protection and fortify the overall lending ecosystem.

"The rate of growth of UPI is strongly correlated to rate of growth of FinTech Lending in India.  A 10 percent growth in UPI corresponds with around 8 percent growth in FinTech lending, so there are natural complementarities and it is in favour of overall lending ecosystem including customers that cyber risks and frauds remain mitigated. Plus, now since RBI has also allowed over draft facility to be linked with UPI along with Rupay credit card linkages, thus it becomes very important to make sure that there are credible deterrents for cyber criminals and fraudsters so that they don't misuse speed and convenience of UPI. 

FQA

1.  What is UPI?

UPI stands for Unified Payments Interface. It is a real-time payment system developed by the National Payments Corporation of India (NPCI) that facilitates inter-bank transactions.

2.  How does UPI work?

UPI uses a unique address called a Virtual Payment Address (VPA) to identify each user. Transactions are initiated by entering the VPA of the recipient and confirming the amount.

3.  What are the benefits of using UPI?

UPI offers several benefits, including:

Convenience: UPI transactions are instant and can be done anytime, anywhere.

Security: UPI uses multiple layers of security to protect transactions.

Cost-effectiveness: UPI transactions are free for most users.

4.  How can I create a UPI ID?

You can create a UPI ID using your mobile number and bank account details. The process is typically simple and can be done through your bank's mobile app or website.

5.  What are the different UPI apps available?

There are several UPI apps available, including:

Google Pay

PhonePe

Paytm

BHIM

MobiKwik

UPI Fraud FAQs

What is UPI fraud?

UPI fraud refers to fraudulent activities that take place within the Unified Payments Interface (UPI) system in India. Fraudsters use various tactics to deceive individuals and exploit vulnerabilities in the UPI ecosystem.