PhonePe Launches UPI Circle for Seamless Payments
PhonePe has unveiled its innovative UPI Circle feature in India, allowing primary users to authorize secondary users to make payments without needing their own bank accounts. Developed by the National Payments Corporation of India (NPCI), this feature aims to enhance the adoption of the Unified Payments Interface (UPI) while promoting supervised spending. While Google Pay announced its support for UPI Circle back in August 2024, the feature is still pending rollout for its users nationwide.
Exploring UPI Circle: Features and Benefits
PhonePe’s UPI Circle is now being rolled out to users across India, enabling them to create a circle of trusted contacts, such as family and friends, who can make transactions using generated UPI IDs, even if they lack a bank account. This feature is designed to facilitate secure and convenient payments while allowing primary users to maintain control over spending.
Once a UPI Circle is established, the primary user can add secondary users, each receiving their own UPI ID for transactions. All payments made by secondary users will be processed through the primary user’s bank account. This setup ensures that primary users can monitor and manage spending effectively.
Primary users have two modes to control the usage of UPI Circle. In the Partial Delegation mode, every transaction initiated by a secondary user requires approval from the primary user. Conversely, the Full Delegation mode allows primary users to set a maximum monthly spending limit for secondary users, eliminating the need for manual transaction approvals. Users can set limits up to Rs. 15,000, with a cap of Rs. 5,000 per transaction.
Additionally, primary users can revoke access to secondary users at any time and track all transactions made. Each secondary user can also have a distinct monthly spending limit, providing flexibility in managing finances.
Limitations and Notifications
Under the UPI Circle feature, a primary user can add up to five secondary users, but each secondary user can only be linked to one primary user at a time. This structure ensures that the primary user is notified after every transaction, even when the Full Delegation mode is active for secondary users. This level of oversight is crucial for maintaining financial security and accountability.
While PhonePe has launched this feature, Google Pay’s support for UPI Circle is still in the pipeline, with no specific rollout date announced for its users. Additionally, the Bharat Interface for Money (BHIM) app also supports UPI Circle functionality, providing users with more options to explore this new payment method.
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