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Introducing UPI lite: Learn how to make the most of it

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Paytm’s platform recently added the UPI Lite payment option. The National Payments Corporation of India enabled the feature to help people carry out multiple small-value UPI transactions instantly and improve their digital payments experience.

The Reserve Bank of India launched UPI Lite in September 2022 to simplify the UPI transaction process. According to an NPCI circular issued in May 2022, 50% of total UPI transactions in the country are worth Rs 200 or less. However, even with low transaction values, the UPI system becomes overburdened, increasing transaction traffic across banks and causing payments to become stuck. UPI requires consumers to add pins and wait for the bank to start payments, which adds to the overall processing time.

Thus, the UPI Lite was designed to start instant payments and reduce traffic between banks. While UPI Lite transactions have already begun to be accepted by the BHIM app, Paytm just became one of the first digital payment apps to launch UPI Lite on its platform.

Let’s examine UPI Lite in greater depth and how to configure it on Paytm

Describe UPI Lite

Users of UPI Lite are able to conduct transactions without using a linked bank account by using a “on-device” wallet. In order to initiate transactions, customers would need to contribute funds to the platform, in the instance of Paytm, in their Paytm wallet.

Once enabled, the UPI Lite wallet allows users to make instant transactions of up to Rs 200 without entering a UPI PIN or waiting for banks to confirm transactions. Notably, users can add a maximum of Rs 2,000 to UPI Lite twice per day, bringing the total daily usage to Rs 4,000.

Furthermore, with UPI Lite, users can make multiple small-value UPI payments without having to worry about exceeding the daily UPI transaction cap on the number of bank transactions. In this way, UPI Lite facilitates low-value UPI transactions. Users can also transfer UPI balances back to the same bank account at any time, free of charge.

How to configure Paytm for UPI Lite

UPI Lite configuration in Paytm:

  • On your iOS or Android smartphone, launch the Paytm app.
  • On the home page, click or tap the “Profile” button in the top left corner.
  • Choose “UPI & Payment Settings” and then pick “UPI Lite” from the list of options under “Other Settings”.
  • On the “Add Money to Activate UPI Lite” page, choose the bank account that qualifies for UPI Lite and enter the amount you wish to add to your UPI Lite account.
  • Complete the process of creating your UPI Lite account by validating your MPIN.
  • Once your account has been established, you can pay with a single tap.

It’s important to note that UPI Lite also aids in clearing out bank passbooks by preventing small-value transactions from appearing there. Instead, these transactions would appear in the Paytm balance and history section.

ALSO READ: Netflix slashes prices in over 30 countries – Is India one of them?

Aaradhya is working as a Sub-Editor at The Vocal News. She enjoys writing about gadgets and automobiles because she is a tech and automotive fanatic. She has done her bachelors in Journalism and Mass communication from Makhanlal Chaturvedi Rashtriya Patrakarita Vishwavidyalaya. "I write to discover what I know."

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