UPI Lite features, safety, benefits and FAQs

Online transactions based on UPI have increased significantly over the past few years. The National Payments Corporation of India (NPCI) reported over Rs.11 crore in transactions in September 2022. Three-fourths of NPCI's transactions are of smaller value, which has led to UPI Lite, an offline payment mode for smaller amounts. Find out more about UPI Lite by reading on.

The number of UPI transactions in India is soaring each day. What started as an India-specific payment system has now expanded beyond Indian borders, and UPI is now available outside of India as well. There is no doubt that UPI is a revolutionary fintech product.

We can manage without cash today, but not without UPI apps such as GooglePay, Paytm, Phonepe, etc. However, if you thought UPI was the fastest payment method, think again! We are already hopping onto UPI Lite before the world catches up with India's unique payment system. UPI Lite is an 'on-device' wallet provided by NPCI to free up spaces in the core banking systems. Small-value transactions can be processed using this offline system. Here's a closer look at this new payment method.

What is UPI Lite?

National Payments Corporation of India (NPCI) has enabled a feature called UPI LITE for multiple small-value UPI transactions. Using it, you can conduct real-time transactions with a single click. Through UPI Lite, users can conduct transactions using an 'on-device' wallet instead of a linked bank account. UPI Lite transactions can only be initiated when users add money to the platform - in the case of Paytm it's their Paytm wallet. As soon as the UPI Lite wallet is set up, the user can make instant transactions up to Rs 200 without adding their UPI PIN or waiting for their bank to confirm their transaction. A maximum of Rs 2,000 can be added to UPI Lite twice daily, making the cumulative daily usage up to Rs 4,000.

In addition, users can make multiple small-value UPI payments with UPI Lite without worrying about the daily UPI transaction cap. As a result, UPI Lite simplifies the process of making low-value transactions through UPI. Users can also transfer their UPI balance back to the same bank account at any time, without incurring any fees.

The Main Features of UPI Lite

  1. Faster Transactions:UPI Lite enables faster transactions since users do not have to download an app that supports UPI. Paytm's UPI Lite feature enables users to initiate and complete transactions quickly.

  2. Simple and User-Friendly Interface:UPI Lite is designed to be easy to use and user-friendly, making it accessible to a wide range of users. It offers an easy-to-use interface that makes it easy to send and receive money.

  3. Compatibility With All Banks: Using UPI Lite, users can transfer funds from any bank account to any other bank account without any restrictions.

  4. No Transaction Fees: A UPI Lite transaction does not incur transaction fees, making it a cost-effective method of transferring funds.

  5. High-Security Standards:The UPI Lite platform uses multi-factor authentication to ensure the security of user data and transactions. A PIN-based authentication system is also included as an added security measure.

How can you set up 'UPI Lite' in BHIM App?

The process of setting up UPI Lite on BHIM is as simple as linking your bank account, generating a UPI PIN, and initiating transactions through UPI Lite. Follow these simple steps:
  1. On the home screen, select 'Link your bank account' under the UPI icon.

  2. Choose a bank account and create a UPI PIN.

  3. You can access UPI Lite by tapping on 'Scan & Pay' and selecting 'UPI Lite'.

  4. Complete the transaction by entering the UPI ID of the recipient or scanning the QR code.

How to Set Up UPI Lite in Paytm?

While BHIM has already implemented UPI Lite, Paytm recently became one of the first digital payment apps to implement UPI Lite. Paytm is the first third-party platform to offer UPI Lite, and the company says it enables faster real-time transactions. In addition, Paytm assures users that UPI Lite will "never fail" during peak transaction times. So, let's take a look at how to set up UPI Lite in Paytm:
  1. Open the Paytm app on your iOS or Android device to set up UPI Lite in Paytm.

  2. Tap on the "Profile" button found on the home page's top left corner.

  3. Under the "Other Settings" section, choose "UPI Lite" under "UPI & Payment Settings".

  4. Activate UPI Lite by selecting the bank account that meets the eligibility requirements for UPI Lite and adding the amount you wish to add.

  5. Complete the process of creating your UPI Lite account by validating your MPIN.

  6. A simple tap allows you to make payments once your account has been created.


Payments through UPI are making monetary transactions faster and more efficient for India and Indians. Now, with the addition of this update. Soon, it is expected to go up a notch, especially for small transactions. This feature on the UPI platform is beneficial to users and banks alike.


  1. Who can use UPI Lite?
    The Paytm UPI LITE service is currently supported by nine banks - Canara Bank, Central Bank of India, HDFC Bank, Indian Bank, Kotak Mahindra Bank, Punjab National Bank, State Bank of India, Union Bank of India, and also Utkarsh Small Finance Bank. The UPI LITE support is expected to spread to more banks soon.

  2. How safe is this latest feature?
    The National Payments Corporation of India (NPCI) has enabled UPI LITE to help users carry out multiple small-value UPI transactions. The UPI Lite wallet is a secure on-device wallet that is linked to your bank account, and you can transfer balances from the linked account to the UPI Lite wallet. It is possible to lock Paytm apps with fingerprints, face IDs, or patterns.

  3. Do you need an internet connection to use UPI Lite?
    You won't need an internet connection to use UPI Lite since all debit transactions up to Rs. 200 can be conducted offline. A connection to the internet is required, however, for credits to be credited to the account.

  4. How do I check my UPI Lite transaction history in my bank passbook?
    A UPI Lite transaction will not appear in the bank's passbook. UPI Lite transactions are updated via SMS every day to the user's registered mobile number.

  5. If UPI Lite is disabled, how can I check my transaction status?
    If you have disabled UPI Lite, all refunds or transactions will appear in your linked bank account. You will no longer be able to see anything in the application.

  6. How many transactions can be made through UPI Lite?
    It is possible to make unlimited transactions with UPI Lite without the need for an internet connection or PIN.

  7. Does UPI Lite charge customers for making transactions?
    No, the UPI Lite application is free of charge, and users do not need to pay extra for money transfers.

  8. How helpful Paytm Lite can be for small businesses and traders?
    With UPI LITE, small-value transactions will be boosted, leading to the larger adoption of digital payments. In addition, it assists small businesses and traders with daily transactions in areas with limited or low connectivity. Introducing Paytm UPI LITE is a small step towards scalability and reliability.


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