What’s Changing?
Starting August 31, NPCI is rolling out new guidelines that will let you link pre‑sanctioned credit lines—like loans against FDs, gold, shares, bonds, property, personal/business loans, unsecured credit, and even KCCs—directly to your UPI app (Google Pay, PhonePe, Paytm, etc.) and use them just like your bank account.
What You’ll Be Able to Do
- Withdraw cash (up to ₹10,000/day) from your credit line via UPI
- Send P2P money (up to ₹1 lakh/day, max 20 transactions)
- Pay P2PM merchants (smaller businesses with <₹50k monthly volume)
- Still limited to P2M as before—but now with added flexibility.
Important Guidelines & Limits
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Banks must ensure usage matches loan purpose (e.g., business loan → business expense only).
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NPCI daily caps still apply: ₹1 lakh/day for transfers, ₹10k/day cash withdrawals, max 20 P2P trips.
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Final control lies with your bank—they may restrict MCC use or specific transaction types.
Why This Matters
- Democratizes credit via UPI: Now you don’t need credit cards—just a pre-approved loan
- Convenience boost: Instant access to funds for business, personal needs, or emergencies
- Better financial discipline: Banks monitor usage to prevent misuse.
Pro Tips Before You Try
- Talk to your bank—check if they support UPI linkage and what categories are allowed
- Understand the purpose limit—your use must match your loan reason
- Stick to limits—avoid declined transactions or penalties
- Watch your transactions for linked UPI spending automatically debiting your credit line.