Not Just for Family Anymore: UPI Circle’s Revolutionary Leap Into India’s Everyday Economy

India's digital payments infrastructure is poised for a revolutionary jump as the country launches UPI Circle, a feature aimed at taking the ability of UPI to far more than mere transfers between friends and family. UPI Circle, developed by the National Payments Corporation of India (NPCI), enables a primary user to authorize trusted secondary users-who might not have a bank account or are hesitant to make digital payments-to make transactions within predetermined limits, all under the supervision of the primary user.

 

Although early usage scenarios target parental monitoring for minors or assistance to elderly citizens, UPI Circle's real strength lies in its wide applicability within households, businesses, and marginalized communities. For working families, it facilitates domestic workers making necessary transactions with expenditure limits. For businesspersons, it authorizes employees to manage operational spending while maintaining control and minimizing the use of petty cash. Even digital illiterates and those without access to bank accounts can now engage in the digital economy through delegated, controlled access.

 

Banks have much to gain too. UPI Circle offers a low-cost, scalable onboarding channel to bring unbanked and underbanked individuals into the fold, with digital footprints that can subsequently be used to enable access to savings, credit, and investment products. Banks can use transaction behavior to customize products and build long-term relationships with customers, driving financial inclusion and economic growth.

 

The feature is already live on the BHIM app and rolling out to platforms such as PhonePe, making it simple for primary users to add secondary users through UPI ID or QR code, establish spending limits, and track all activity in real time. With permission levels that can be customized, open transaction records, and strong security, UPI Circle is set to transform digital payments-bridging India's financial divide and bringing millions into the formal banking system.

 

Source: Times of India