UPI: What is it, its scams and why NPCI capped UPI transaction limit?

National Payments Corporation of India (NPCI) has capped the number of UPI transactions that third-party apps such as Google Pay, PhonePe, etc. can execute. UPI payment method is widely used nowadays, but scams related to UPI have also risen significantly. Here's all you need to know.
Created On: Aug 4, 2020 21:36 IST
Modified On: Aug 4, 2020 21:37 IST
UPI scam
UPI scam

National Payments Corporation of India (NPCI) has capped the number of UPI transactions that third-party apps such as Google Pay, PhonePe, etc. can execute. After the introduction of UPI or the Unified Payments Interface, digital payments have significantly risen in the last few years. People are using more and more digital payments app such as Google Pay, Phonepe, Paytm, BHIM etc. for digital transactions. In addition to this, banks are also providing their customers with net banking and wallet service facilities. 

During the nationwide lockdown, UPI payment method is widely used as everyone can easily pay through this payment method. The number of users paying with UPI has crossed 100 million. However, this has given rise to the UPI scams too. New tactics are being adopted by the fraudsters for looting money digitally. Therefore, it is advised to stay alert and protect yourself from these frauds.

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What is UPI?

UPI or the Unified Payments Interface is a real-time payment platform that helps in instantly transferring the funds between the two bank accounts through the mobile platform. 

How will the cap work?

The cap will work as given in the table below :

Year  Cap
In the First Year of Operation 50% 
In the Second Year of Operation 40%
In the Third Year of Operation 33%

The capping of market share will apply from April 1, 2020, retrospectively. In case of the breach of the rules, NPCI will start penalizing these companies and may also ask them to stop onboarding of the new customers with immediate effect. 

Banks send alerts via e-mails and SMS

All the public and private sector banks alert their customers from time to time through e-mail and SMS to avoid fraud. This alert consists of tips which advise the customers to not share their OTP, bank details, card details (CVV, card number, etc.) with the third person. It must be noted that banks never ask for any data related to the bank account of their customers. 

Fraudsters ask for details

Fraudsters ask for bank details (account number, IFSC etc.), debit card details and other details related to your bank account in the name of bank executives. They either ask for OTP or UPI registration details through which they manage to create a virtual payment address (VPA). Once all the details are provided to them, they loot your hard-earned money. 

How to avoid fraud?

1- Never share important details like debit card number, expiry date, registration, OTP with anyone. Many a time, the caller asks you these details in the name of bank executive stating that your card will be blocked. Do NOT fall for these types of calls. 

2- All the banks have made it clear that they do not ask any such details from their customers as the bank already has these details. 

3- Do not click on any unofficial link from the SMS. Also, do not forward any such SMS.

4- UPI MPIN should not be shared with anyone. MPIN is the one which you enter in the UPI app to check your balance. 

5- Apart from banks, SMS can also come in the name of IRDAI and EPFO. However, they also do not send any such message.

6- Subscribers do not have to share the details of their bank account.

Thus, to avoid scams, do not share the details related to your bank account, debit card, etc. to anyone. It is also advised to not download any app or confirm payment from unknown accounts via UPI. 

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