Outlook Business Desk
National Payments Corporation of India (NPCI) has sought RBI’s approval to extend Unified Payments Interface (UPI) cash withdrawal services to over two million business correspondent outlets across India, expanding access beyond current limited options.
Currently, UPI cash withdrawals are restricted to certain ATMs and merchants, with limits of ₹1,000 in urban areas and ₹2,000 in rural regions. The proposal suggests raising this to ₹10,000.
Business correspondents (BCs) act as local agents in areas with few branches or ATMs. They may be shopkeepers, non-profits, or individuals providing essential banking services.
The new UPI withdrawal system could aid customers who struggle with fingerprint verification or avoid using debit cards. However, as physical presence won’t be required, experts caution that the chances of fraud and misuse through business correspondents may increase significantly.
UPI now drives about 85% of India’s digital payments and nearly half of global real-time transactions. On August 2, daily transactions reached a record 707 million, reflecting rapid adoption across the country.
Meanwhile, in July, UPI processed 19.5 billion transactions worth more than ₹25 trillion, showing how widely it is used for digital payments across India.
The government aims to achieve one billion UPI transactions daily, a goal NPCI expects to reach next year given current growth trends. Meanwhile, the proposed UPI cash withdrawal facility is still under RBI review.