The Reserve Bank of India on Wednesday proposed to increase Unified Payment Interface (UPI) transaction limit for investing in Initial Public Offerings to Rs 5 lakh from its current limit of Rs 2 lakh.
“UPI has also become a popular payment option for Initial Public Offerings (IPOs) since its availability from January 01, 2019. It is reported that IPO applications of Rs 2 to Rs 5 lakh constitute approximately 10 per cent of subscription applications,” RBI said in a statement.
“To further encourage the use of UPI by retail investors, it is proposed to enhance the transaction limit for payments through UPI for Retail Direct Scheme and IPO applications from Rs 2 lakh to Rs 5 lakh,” the central bank added.
Noting that UPI is the single largest retail payment system in the country in terms of volume of transactions, the central bank proposed to offer a simpler process flow by enabling small value transactions through an “On-device” wallet in UPI app which will conserve banks’ system resources, without any change in the transaction experience for the user.
Meanwhile, the Reserve Bank of India (RBI) on Wednesday kept the benchmark interest rate unchanged at 4 per cent and decided to continue with its accommodative stance in the backdrop of concerns over the emergence of the new coronavirus variant Omicron.
This is the ninth time in a row that the Monetary Policy Committee (MPC) headed by RBI Governor Shaktikanta Das has maintained the status quo. RBI had last revised its policy repo rate or the short-term lending rate on May 22, 2020 in an off-policy cycle to boost demand by cutting the interest rate to a historic low.