NPCI launches 'UPI Circle' for delegate payments; here's how it works

The National Payments Corporation of India (NPCI), the nodal government body for online retail payments, has announced the launch of 'UPI Circle' for delegate payments.

The feature is aimed at helping users to carry out unified payment interface (UPI) transactions, even if they do not have direct control over their finances.

This will particularly benefit those users who are dependent on others for their finances. They would be able to make payments online via the UPI system, despite the primary account not being linked to them. Here's a look at how it works:

First, what exactly is UPI Circle?

UPI Circle is a feature where primary users can link the UPI accounts with their trusted secondary users on their UPI app for either partial or full delegation, NPCI stated in its circular issued on August 13.

"There are users who are still dependent on cash for their daily payment needs because they do not manage their own money through their own account. With the objective of addressing these unmet needs, “UPI Circle” is introduced, wherein UPI users can delegate to their trusted secondary users for making payments," it added.

Two types of delegation

Full Delegation — Under this type of delegation, primary user authorises a secondary user to initiate and complete UPI transactions as per defined spending limits.

Partial Delegation — In this case, primary user authorises initiation of payment requests from secondary users. However, these transactions would be completed only after the primary users approve them by entering the UPI pin.

For full delegation, a maximum monthly limit of ₹215,000 per delegation, and maximum per transaction limit of ₹5,000 will be imposed. For partial delegation, the existing UPI limits shall be applicable, the circular noted.