UPI has made digital payments in India much easier, allowing users to make instant payments by simply entering a phone number or scanning a QR code. For every UPI payment made, even for low-value transactions, the bank sends an email and message, and the transaction is also recorded in the passbook. This is why setting up UPI Lite makes a lot of sense, as it even simplifies the already easy-to-use UPI payments.
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UPI Lite is an on-device wallet from the National Payments Corporation of India (NPCI), and it is much simpler to use. It lets users make quick payments of up to Rs 500 at a time, with the wallet capable of holding a maximum balance of Rs 2,000. Unlike regular UPI payments, UPI Lite transactions don’t require a PIN for authentication, thereby reducing the payment failure rate – something that’s been an issue with UPI.
UPI Lite uses an on-device wallet approach, meaning the balance is tied to the smartphone and cannot be transferred to another device. When upgrading to a new phone, users must empty their UPI Lite wallet to avoid losing their money. The funds loaded into the UPI Lite wallet remain in the common library of the wallet app.
UPI Lite offers a higher transaction success rate and is currently supported by over 50 UPI payment apps, including popular solutions like Google Pay, PhonePe, Paytm, BHIM, and more. Setting up a UPI Lite wallet takes only a few seconds if you already use any of these UPI apps.
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To configure UPI Lite and add money, follow these steps:
Open UPI apps such as BHIM, Google Pay, or PhonePe.
Click on the enable UPI Lite option and accept the terms and conditions.
Enter the desired amount to load into the UPI Lite wallet (up to Rs 2,000).
Authenticate the transaction by entering the UPI passcode.
To make payments using UPI Lite, scan any UPI-powered QR code or enter the recipient’s phone number, and select UPI-Lite as the payment option. Currently, users can send up to Rs 500 per transaction. Users can also easily delete a UPI Lite account, which will refund the money to the bank account used to load the wallet.
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Unlike most third-party digital wallets, which limit transactions to specific apps/platforms, UPI Lite allows users to send money to any UPI app.
Limitations of UPI Lite include restrictions on the amount of money that can be loaded in a day (up to Rs 4,000) and the maximum wallet balance of Rs 2,000. Additionally, funds stored in UPI Lite do not accrue interest like those in a bank account. If a smartphone with a UPI Lite account is lost, the money cannot be recovered.
Despite these limitations, UPI Lite offers several benefits, especially for those who make many small payments throughout the day and want to avoid cluttering their bank statements. With its enhanced success rate, it is a must-have for everyone who frequently uses UPI for payments.
