The Unified Payments Interface (UPI) is now the most preferred method for digital monetary transactions in India. Rules implemented in 2026 have made the whole system not only more secure but also more transparent and in line with the continuously increasing user base. The changes involved are mainly regarding the relevant transaction limits, security measures, and compliance requirements.
What Changed in 2026
The Reserve Bank of India (RBI) along with National Payments Corporation of India (NPCI) has reviewed the UPI policies in view of the increasing transaction volumes and risks associated with fraud. The new rules specifically deal with the aspects of daily limits, authentication, and GST-linked compliance for merchants. The changes are aimed at protecting the users while at the same time facilitating the flow of digital payments.
Transaction Limits
Starting from April 2026, a daily limit of ₹1,00,000 is set for UPI transactions for the majority of users. However, exceptions can be made for certain categories like education fees, hospital bills, and high-value purchases that can go up to ₹5,00,000. Moreover, new users during the initial 24 hours of their registration will not be allowed to transact more than ₹5,000 a day. This regulation is meant to safeguard against exploitation of recently created accounts.
Security Enhancements
As a part of the two-factor authentication requirement, the UPI system is now using at least one dynamic security measure to identify the user accurately. Thus, the confirmation of a transaction must include both the user’s PIN and an additional verification method such as biometric recognition or OTP. All these activities lead to a significant reduction in the risk of unauthorized transfers.
GST and Compliance Rules
Businesses using UPI QR codes now need to ensure that they are in compliance with the GST turnover criteria. Every business exceeding the ₹40 lakh (₹20 lakh for services) revenue threshold must register and attach their GST particulars to UPI receipts. This will lead to better tax compliance and transparency of digital transactions.
UPI New Rules 2026 Snapshot
| Feature | Earlier Rule | 2026 Rule | Impact |
|---|---|---|---|
| Daily Transaction Limit | ₹1,00,000 | ₹1,00,000 (general), ₹5,00,000 (exceptions) | Flexibility for high-value needs |
| New User Setup Limit | No restriction | ₹5,000 per day for 24 hours | Prevents misuse of new accounts |
| Authentication | PIN-based | Two-factor with dynamic security | Stronger fraud protection |
| Merchant GST Compliance | Not mandatory | Mandatory above ₹40 lakh/₹20 lakh turnover | Improved tax transparency |
| Gift Transactions | No clear rule | Limit of ₹500 | Discourages misuse of small transfers |
Conclusion
The UPI New Rules 2026 signifies an essential milestone in reinforcing digital payment ecosystem of India. Security and transparency has been increased through revamped limits, stringent authentication, and GST-linked compliance and the system is less open to fraudulent activities. All these alterations have a positive effect on consumers, as they will have safer transactions and more defined rules, and businesses will have the same standard rules, which will contribute to their long-term growth.