Investing via UPI: Daily transaction limit to be raised to ₹5 lakh from ₹2 lakh, says Sebi | Mint

Capital markets regulator Securities Exchange Board of India (Sebi) has alluded that the daily transaction limit for capital market transactions is set to be raised to ₹5 lakh.

The daily transaction limit currently stands at ₹2 lakh. Notably, this is not a final announcement but a part of the Sebi’s consultation paper on draft circular dated Jan 31, 2025 for safe and efficient transfers on UPI (Unified Payment Interface).

However, this new limit ( ₹5 lakh) will also be subject to further evaluations from time to time in consultation with NPCI.

Analysis of transactions

Before coming to any conclusion, Sebi carried out an analysis of transactions made by the clients of top brokers. In the analysis, it was observed that individual transactions below one lakh accounts for 92.9 percent of total transactions whereas transactions between ₹1 lakh to less than 2 lakh constitute 3.9 percent and transactions between 2-3 lakh constitute 1.3 percent.

For total transactions during the day by an investor, these figures were 91.5, 4.6 and 1.6 percent, respectively.

Based on this analysis, Sebi has now proposed to set the upper limit of upto ₹5 lakh per day. The regulator has further added that the proposed implementation is unlikely to entail any major costs. The entire process involves four nodes which are NPCI, banks, registered intermediaries and Sebi.

Sebi’s consultation paper also mentioned that NPCI has confirmed that issuance of new handles is an ongoing exercise for them. They regularly issue new UPI handles to the new entrants, and therefore, their systems are accordingly designed to accommodate such changes.

Meanwhile, in another news, NPCI released a circular dated Jan 9 which stated that from Feb 1 onwards, the central system will decline all transactions containing special characters. The transaction IDs are supposed to be alphanumeric only but sometimes, they can have special characters too.