How should our mobile app checkout validate category-wise UPI limits for credit card bill payments after the September 15, 2025 change?

Honestly, this is one of those boring but super important changes that came after the Sept 15, 2025 UPI update. NPCI bumped limits for certain categories like term deposits, insurance premiums, and capital market investments up to ₹10L per day in some cases.

The problem? Most users (and even devs) don’t realize their bank or PSP (PhonePe, Paytm, Razorpay, etc.) might already support higher UPI limits. So your ERP needs to tell them in real-time whether they’re good to go for a high-value payment.

Here’s how I’d approach it:

• Check the user’s actual UPI limits via the PSP API

Most UPI PSPs now let you query a user’s limit metadata using their VPA.
So when someone enters something like user@icici, you hit an endpoint like:
GET /upi/v1/limits?vpa=user@icici

and get back a response that tells you if that category (term deposits = TDOPEN) supports higher limits.

If it says eligible: true, show a banner that says:

Your bank supports high-value UPI deposits (up to ₹10L). You can proceed safely.

If not, fallback to a gentle warning:

Your current UPI account may have a ₹1L cap. Try NEFT/RTGS for larger deposits.

• Use the new NPCI purpose codes

UPI transactions now carry category tags TDOPEN for term deposits, INSURANCE, CAPMKT, etc.

Your ERP should use those to check if the user’s bank supports higher caps for that specific purpose.

If the purpose code is recognized and supported, show that eligibility message.

If not, hide the high-limit banner to avoid confusion.

• Add dynamic messages in the payment screen

Instead of one static Pay via UPI button, make it context-aware:

• If eligible → show High-value UPI enabled (₹10L cap)
• If not → show UPI limit ₹1L try NEFT for larger deposits

Little thing, but it saves tons of failed transactions and support tickets.

• Tag this info in backend logs

Once the eligibility is confirmed, tag the transaction with a flag like
upi_high_value=true.

This helps with reconciliation and audit trails later especially when settlement teams are figuring out why some UPI payments show up in the high-value bucket.

• Show it on receipts too

After payment succeeds, include a line like:
Paid via UPI (High-Value Limit Enabled ₹10,00,000 cap).
Auditors love this kind of transparency.

When your POS system hits the new UPI caps mid-checkout for a term deposit opening, the key is to fall back gracefully without making the customer feel like the transaction failed. After September 15, 2025, NPCI allows higher UPI limits (up to ₹10 lakh/day) for verified categories like term deposits, but if a customer hits that cap (either per-transaction or daily), your POS needs to automatically suggest alternate, compliant payment methods so the flow doesn’t break.

Here’s how to handle it smartly:

• Detect limit breaches early.

Before the UPI intent even fires, your POS should validate the amount against the merchant’s configured NPCI category cap and the customer’s remaining daily quota. If it’s close to the cap (say, above 90%), show a pre-check message like This UPI payment may exceed your daily limit. Would you like to split or use another method? This saves users from failed transactions at the final step.

• Offer context-aware fallback options.

For high-value term deposits, don’t just say use another method. Suggest specific alternatives that suit the context:

• Netbanking (NEFT/RTGS): Ideal for large transactions above ₹2 lakh. Most customers opening term deposits are already comfortable with it.
• Debit card (linked to same bank): For users who prefer to stay within one ecosystem some banks allow instant deposit funding this way.
• IMPS (for smaller spillover amounts): Works if only a few thousand rupees exceed the UPI cap.
• In-branch collection or cheque: As a last resort for users uncomfortable with online flows or those hitting regulatory limits.
•  Auto-split suggestion for UPI itself.

If the total is ₹10.5 lakh and the customer has ₹9.5 lakh remaining under their UPI limit, the POS should automatically prompt: You can complete ₹9.5 lakh now via UPI and pay the remaining ₹1 lakh via netbanking. Split flows like this help keep conversion rates high while staying compliant.

• Persist the context.

Make sure the fallback options carry over the customer’s original term deposit details amount, duration, account so they don’t have to re-enter everything when switching methods. This makes the fallback feel like a continuation, not a restart.

• Use real-time PSP feedback.

If the PSP returns a response like TXN_LIMIT_EXCEEDED or DAILY_CAP_REACHED, your POS should map that error to a user-friendly suggestion, not a dead-end error. Example: This payment exceeds your UPI daily limit. You can continue securely using netbanking or card.

• Log fallback triggers for compliance.

Each fallback should be recorded with details like original payment method, failure code, chosen alternative, and timestamp. NPCI and auditors often ask for this data when verifying compliance with limit rules.

When your POS system hits the new UPI caps mid-checkout for a term deposit opening, the key is to fall back gracefully without making the customer feel like the transaction failed. After September 15, 2025, NPCI allows higher UPI limits (up to ₹10 lakh/day) for verified categories like term deposits, but if a customer hits that cap (either per-transaction or daily), your POS needs to automatically suggest alternate, compliant payment methods so the flow doesn’t break.

Here’s how to handle it smartly:

• Detect limit breaches early.

Before the UPI intent even fires, your POS should validate the amount against the merchant’s configured NPCI category cap and the customer’s remaining daily quota. If it’s close to the cap (say, above 90%), show a pre-check message like This UPI payment may exceed your daily limit. Would you like to split or use another method? This saves users from failed transactions at the final step.

• Offer context-aware fallback options.

For high-value term deposits, don’t just say use another method. Suggest specific alternatives that suit the context:

• Netbanking (NEFT/RTGS): Ideal for large transactions above ₹2 lakh. Most customers opening term deposits are already comfortable with it.
• Debit card (linked to same bank): For users who prefer to stay within one ecosystem some banks allow instant deposit funding this way.
• IMPS (for smaller spillover amounts): Works if only a few thousand rupees exceed the UPI cap.
• In-branch collection or cheque: As a last resort for users uncomfortable with online flows or those hitting regulatory limits.
• Auto-split suggestion for UPI itself.

If the total is ₹10.5 lakh and the customer has ₹9.5 lakh remaining under their UPI limit, the POS should automatically prompt: You can complete ₹9.5 lakh now via UPI and pay the remaining ₹1 lakh via netbanking. Split flows like this help keep conversion rates high while staying compliant.

• Persist the context.

Make sure the fallback options carry over the customer’s original term deposit details amount, duration, account so they don’t have to re-enter everything when switching methods. This makes the fallback feel like a continuation, not a restart.

• Use real-time PSP feedback.

If the PSP returns a response like TXN_LIMIT_EXCEEDED or DAILY_CAP_REACHED, your POS should map that error to a user-friendly suggestion, not a dead-end error. Example: This payment exceeds your UPI daily limit. You can continue securely using netbanking or card.

• Log fallback triggers for compliance.

Each fallback should be recorded with details like original payment method, failure code, chosen alternative, and timestamp. NPCI and auditors often ask for this data when verifying compliance with limit rules.

After September 15, 2025, your POS needs to dynamically validate UPI limits based on category and merchant verification. For term deposits, that means: tag with purpose code INVS_TD, confirm merchant eligibility for high-value UPI, enforce ₹10L/day caps, and gracefully handle over-limit attempts. Basically, your limit logic has to get smarter, not just stricter.

If your POS system accepts UPI payments for term deposit openings, you’ll need to tweak both your settlement and ledger rules to handle the new high-value UPI limits properly. Since September 15, 2025, the NPCI lets verified categories like term deposits go up to ₹10 lakh per day — but that also means your system has to treat these transactions differently from normal retail payments.
First, update your settlement rules. Tag every UPI transaction meant for term deposits with the correct NPCI purpose code INVS_TD. This ensures they aren’t mixed with normal sales payments. Route them through a separate investment or deposit settlement batch rather than the standard POS batch, because banks may process these through different merchant codes and timings. Large-value UPI payments (above ₹2 lakh) often settle on a T+1 basis, so your settlement logic must support delayed posting. Also, only allow routing through verified PSP handles that actually support high-value UPI; not every PSP does. Finally, your reconciliation flow should match each incoming UPI receipt against a term deposit creation request so that the finance team never sees unlinked receipts in their end-of-day reports.
Next, update your ledger mapping. In normal retail flows, a UPI receipt credits sales revenue but for term deposits, that’s incorrect. Instead, when a customer opens a term deposit via UPI, the entry should debit the bank (UPI receipts) and credit a Term Deposit Liability account. Once the term deposit is actually created or confirmed in the core banking system, that liability should move to the Term Deposit Principal account. If a refund happens before creation, you’d reverse it by debiting the liability and crediting Bank UPI Refunds Payable.
You’ll also want to add some extra controls in your posting logic. Always store the NPCI purpose code (INVS_TD) in your transaction records so audits can identify investment-linked UPI flows. Maintain a link between the UPI Reference ID and the Term Deposit ID to make reconciliation painless. Set up a daily aggregate view to make sure the total UPI receipts tagged as INVS_TD don’t exceed ₹10 lakh per merchant per day. And log PSP handle details and payer VPAs to meet compliance requirements.
Before settlement posting, the POS should also verify a few things: that the PSP handle supports high-value UPI, the transaction status is successful, the settlement window hasn’t expired, and the total daily inflows for that category are still within limit. If any of these checks fail, the transaction should be flagged for manual review instead of getting auto-posted.