India has seen a remarkable shift towards digital payments over the last few years. The Unified Payments Interface (UPI) has become the go-to choice for everything from paying bills and booking tickets to shopping online. But as more people use UPI for everyday transactions, there’s a growing need for something faster and lighter for frequent, smaller payments.
That’s where UPI Lite comes in. Introduced by the National Corporation of India (NPCI), it is designed to make small-value transactions seamless and hassle-free. If you are wondering which option works better for your day-to-day payments - UPI or UPI Lite, this blog will help you understand their differences, benefits, and when to use each for quick and secure payments.
UPI Lite is a feature launched by the Reserve Bank of India (RBI) in September 2022 and developed by the National Payments Corporation of India (NPCI). It functions as a small on-device wallet within your UPI-enabled app, designed specifically for quick, low-value payments of up to ₹1,000. Unlike regular UPI transactions, UPI Lite does not ask for a UPI PIN each time you pay.
The main purpose of UPI Lite is to handle a large number of small-value payments without repeatedly connecting to the bank’s main system. This reduces transaction time and keeps payments seamless, even in areas with poor or patchy internet connectivity.
The Unified Payments Interface (UPI) is an instant real-time payment system developed by the National Payments Corporation of India (NPCI), an organisation regulated by the Reserve Bank of India (RBI). Built on the Immediate Payment Service (IMPS) infrastructure, UPI enables seamless money transfers between banking accounts using a single mobile application.
It uses identifiers such as Virtual Payment Address (VPA/UPI ID), mobile number, or QR codes instead of traditional banking details, making transactions simple, secure, and fast. Operating 24/7 throughout the year, UPI supports a wide range of payments such as peer-to-peer transfers, merchant payments, bill settlements, and more. This way, UPI plays a pivotal role in advancing India’s digital payments ecosystem.
Read on: How to Change UPI ID in Google Pay, PhonePe, and Paytm
| Feature | UPI (Standard) | UPI Lite |
|---|---|---|
| Transaction type | All payments | Small-value payments |
| PIN requirement | A UPI PIN is required for every transaction | No PIN is required for payments |
| Transaction limit (per transaction) | 20 transactions per day, up to ₹1 lakh (may vary by bank and merchant category) |
₹ 100 - Minimum amount the user can load ₹ 1,000 - Process low-value transactions without UPI PIN ₹ 5,000 - Maximum store value limit in wallet |
| Fund transfer | Send and receive money using all bank accounts | Send money |
| Availability | UPI Bank/PPI Live: 688 (94-PSP and 594-Issuer) | UPI Lite supported banks - 65 Payment apps - 35 |
| Bank statement | Every transaction is reflected in your bank statement | Only the ‘top-up’ or ‘add money’ transactions are reflected. Small payments made via UPI Lite do not appear individually |
| Internet connectivity | Requires a steady internet connection for each transaction | Designed to work even in low or no-internet conditions |
If you frequently make low-value online purchases, using UPI Lite is more efficient than UPI. It eliminates the need to input a UPI PIN for small payments, significantly speeding up the transaction process and making checkout faster.
UPI Lite is an on-device wallet, which means it functions seamlessly at any time, even during bank maintenance windows. This availability ensures that you can always make a small payment whenever needed.
Once your wallet is topped up, you can make payments without a UPI PIN for each transaction. This single-click or tap-and-pay experience makes the payment process significantly faster and more efficient, especially for hurried purchases like buying a cup of coffee.
Since UPI Lite transactions are processed directly on your device and rely less on real-time internet connectivity, they offer a higher success rate, especially in crowded areas or rural regions with weak network coverage.
If your bank statement is cluttered with small payments, UPI Lite is the solution. All your UPI Lite payments appear as a single, consolidated entry for the 'top-up' amount, giving you a cleaner bank passbook.
Read on: How to Change UPI PIN: A Step-by-Step Guide
The future of UPI Lite appears very promising due to continuous innovations introduced by the RBI and NPCI. A major milestone in this journey is UPI Lite X, launched in September 2023, which enhances the existing UPI Lite wallet features.
With UPI Lite X, users can send or receive money even when neither party has internet connectivity. This is made possible through Near Field Communication (NFC) technology, which facilitates secure, contactless transfers. The ₹2,000 wallet balance limit and ₹500 per transaction cap remain the same for both UPI Lite and Lite X, ensuring consistency for users.
UPI Lite X can be enabled via any UPI app that supports the feature. It requires customer consent, a linked bank account, and UPI PIN authorisation during activation. However, existing UPI Lite users can enable Lite X without entering a UPI PIN, making the onboarding experience smooth and hassle-free.
This development ensures that digital transactions remain inclusive and convenient, particularly in areas with unreliable internet connectivity. By enabling seamless payments for both the payer and the payee—whether online or offline—UPI Lite X is shaping a more resilient and accessible digital payments ecosystem for India’s future.
Both UPI and UPI Lite serve different but equally important purposes in India's digital payment ecosystem. While UPI has revolutionised financial operations for all types of transactions, UPI Lite specifically addresses the large volume of low-value payments without the need for a UPI PIN and offers faster and secure checkouts.
For instance, in a remote area, you can use UPI Lite to purchase a packet of chips or pay for a coffee. The instant payment system provides the convenience of accessing digital cash on your phone to complete transactions quickly. Ultimately, the combined power of UPI and UPI Lite ensures that the convenience of a cashless economy is available to everyone, regardless of transaction size or network coverage.
Unified Payments Interface (UPI) is a real-time digital payment system that allows you to transfer money between any two bank accounts using a single mobile application.
UPI Lite is a simplified, on-device wallet designed to handle small-value transactions up to ₹1,000 without requiring a UPI PIN. It is a feature within your existing UPI app that enables faster and more convenient micro-transactions.
To get started, activate UPI Lite within your app and add funds to your wallet from your bank account using your UPI PIN. After that, you can make payments up to ₹1,000 without entering a UPI PIN.
Yes, UPI Lite is a very secure payment method. It is built on the same strong security framework as the standard UPI system, and your device's security features, such as a fingerprint or pattern lock, provide extra protection for your wallet.
The UPI Lite transaction limit is up to ₹1,000 without UPI PIN, and you can store a maximum of ₹5,000 in your wallet and load a minimum of ₹100 at once.
Get credit at first sight and be closer to your goals.
Download Now
