UPI users across India will see a key change in how digital payments are completed from April 1, 2026, following a new rule introduced by the Reserve Bank of India. The update aims to strengthen transaction security by adding an extra verification step beyond the existing PIN system. While the move is expected to make payments safer and reduce fraud risks, it may slightly increase the time taken to complete everyday transactions across platforms such as PhonePe, Google Pay and Paytm.
What Changes
Under the new rule, entering a UPI PIN alone will no longer be sufficient to complete a payment. Users will now need to undergo two-factor authentication, meaning a second layer of verification will be required.
This additional step could include a one-time password (OTP), fingerprint authentication, or facial recognition. A transaction will only be processed once both verification steps are successfully completed, ensuring that even if a PIN is compromised, unauthorised payments cannot go through.
Impact On Users
The change is expected to significantly reduce the risk of online fraud and scams. Even if fraudsters gain access to a user’s PIN, they will not be able to complete transactions without the second authentication factor.
However, users may notice a slight delay in payments, as each transaction will now involve an additional step. Whether paying for small purchases like tea or settling larger bills, the process will take marginally longer but offer improved protection for users’ funds.
Limits Stay Same
There is no change in transaction limits. Users can continue to send up to Rs 1 lakh per day for general transactions. For specific categories such as hospital bills, education fees, and insurance payments, the limit remains Rs 5 lakh.
For new users, the existing cap of Rs 5,000 within the first 24 hours will continue to apply as a precautionary measure.
ATM Rule Tweaked
Changes have also been introduced for cardless cash withdrawals using UPI at ATMs. Some banks, including HDFC Bank, have started counting UPI-based withdrawals within the monthly free ATM transaction limit.
This means that once users exceed their free withdrawal quota, charges will apply even for UPI-based cash withdrawals, similar to debit card transactions.
What You Should Do
Users are advised to update their UPI apps to ensure compatibility with the new system. Enabling biometric authentication, such as fingerprint or face unlock, can help complete transactions more quickly without relying on OTPs.
Despite the enhanced safeguards, users should continue to avoid sharing their PIN or OTP with anyone to prevent fraud.
