Why RBI Proposed Delay Of 1 Hour?
The primary objective of this proposal is to curb the rapidly increasing online fraud. According to data, transactions above Rs 10,000 account for 45 per cent of total fraud cases (by volume) and 98.5 per cent by value. Over the past five years, the amount of digital fraud has increased 41-fold to approximately Rs 23,000 crore. A one-hour delay would provide a window for the sender to cancel suspicious transactions.
Will This Take Away 'Instant Payment' Feature Of UPI?
Bankers have expressed concern that UPI's primary feature is instant payments. The practice of "lagged credits" contradicts this fundamental principle. However, technical service providers (TSPs) and bankers also believe that deliberately introducing some friction into the system to prevent fraud is the need of the hour, even if it reduces convenience.
Have Banks Asked For Change In Limit?
Banks are seeking changes to this limit to strike a balance between security and convenience. According to a senior executive at a private bank, cited by Jagran Business banks may seek to increase the Rs 10,000 limit to Rs 25,000 or more, as the impact of losses is greater for transactions involving larger amounts. Banks are discussing the issue with the Indian Banks' Association (IBA) and payment SROs and will submit their feedback to the RBI by May 8.
Will There Be Delay In All Types Of Payments?
No, the RBI has excluded merchant payments (payments made to merchants or shopkeepers) from this rule. This is because merchants are already subject to KYC verification by banks. This rule will primarily apply to personal transfers. Additionally, users will have the option to 'whitelist' accounts of their acquaintances and those with regular transactions, allowing for instant money transfers to those accounts without any delays.
The Reserve Bank of India (RBI) has proposed a significant shift for UPI and other digital payments in April 2026.
Here is the breakdown of what these changes mean for your daily transactions:
The 1-Hour Delay Rule
The headline change is a proposed one-hour "cooling period" for certain transactions.
The Threshold: This applies to account-to-account transfers above Rs 10,000.
The Scenario: It specifically targets the first-time transfer you make to a new payee.
How it works: When you send money to someone for the first time, the amount will be debited from your account but held for 60 minutes before reaching the receiver. During this window, you have the option to cancel or reverse the transaction if you realize it was a mistake or a scam.
Mandatory Two-Factor Authentication (2FA)
As of April 1, 2026, the traditional UPI PIN alone is no longer considered sufficient for high-value or sensitive transactions.
Beyond the PIN: Users may now need a second layer of verification, such as Biometrics (fingerprint or face ID) or a device-based approval.
Risk-Based Triggers: The system uses "risk-based authentication."
If you are making an unusually large payment or using a new device, the app will automatically trigger these extra security steps. 
Protection for Vulnerable Users
For users aged 70 and above, a "Trusted Person" protocol has been introduced:
Transfers above Rs 50,000 for senior citizens may require a secondary approval from a designated trusted contact (like a family member).
While this is a safety measure, users have the choice to opt out of this feature if they prefer total independence.
What Stays the Same?
To ensure that "India's real-time success story" isn't completely slowed down, several categories remain exempt from the one-hour delay:
Merchant Payments: Paying at a grocery store, petrol pump, or restaurant remains instant, regardless of the amount.
Regular Payees: Once you have "whitelisted" a contact or made a successful transaction with them once, all future payments to them will be instant.
Standard Limits: The daily limit generally remains at Rs 1 lakh, though it has been increased to Rs 5 lakh for specific categories like Tax payments, Hospital bills, and Educational fees.
This video provides a concise summary of the RBI's proposal and explains the specific safety measures being introduced to protect users from digital fraud.
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