On December 4, the payments industry welcomed the Reserve Bank of India’s move to hike the limit of contactless card transactions from Rs 2,000 to Rs 5,000.
To promote the adoption of digital payments safely and securely, the central bank has proposed to enhance this limit, at the discretion of the user, effective from January 1, 2021. RBI said, “In a Contactless NFC card, the card is read by keeping the card near the card reader. The EMV Chip & PIN cards and Contactless NFC cards are considered to be safer when compared to Magnetic Stripe cards.”
“The increase of the limit on contactless card payments from Rs 2,000 to Rs 5000 is a positive and progressive decision by the RBI. This surely will add to the customer convenience, especially, during the prevailing conditions, further boost the digital payments ecosystem in India,” said Ashwini Kumar Tewari, Managing Director & CEO.
“The increased limit will help to boost the average value of the transaction and push the adoption of digital payments. The announcement will help RuPay cardholders to make secured contactless transactions of up to Rs 5,000 on the go thereby facilitating them with a hassle-free transaction experience. Similarly, this will be a major boost to the users of recently launched UPI AutoPay functionality for the customers to execute their high ticket recurring payments like utility bills, investments, two-wheeler EMIs, consumer durable EMIs, etc. seamlessly. The move will also help customers to on-board into BHIM UPI for performing easy and convenient P2P and P2M transactions,” said Dilip Asbe.