NPCI to Block These UPI Transactions From February 1: Here’s What You Need to Know

The National Payments Corporation of India (NPCI) has issued a new directive that will impact users of the Unified Payments Interface (UPI). The ongoing efforts to enhance the UPI ecosystem include this modification. From February 1, 2025, you should be aware of how this shift may affect you if you depend on UPI for everyday transactions.

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Key Changes to UPI Transactions

In the release, the key change highlighted is that starting February 1, 2025, UPI transactions containing special characters in the transaction ID will be blocked by the central system. This decision comes after an earlier recommendation dated March 28, 2024 (OC 193) that suggested utilising only alphanumeric characters to construct UPI transaction IDs.

NPCI found that certain participants were still using special characters, even though the majority of the UPI ecosystem followed these rules. In order to ensure uniformity, security, and compliance throughout all UPI transactions, this rule's enforcement was further tightened.

Will This Affect Your Transactions?

If your UPI app generates transaction IDs with any non-alphanumeric characters, those transactions will be rejected after the deadline. UPI users are advised to ensure their apps generate compliant alphanumeric IDs to avoid any payment issues.

UPI Transactions Surge to New Heights

The Unified Payments Interface (UPI) was launched in India on April 11, 2016, by the Reserve Bank of India (RBI) and the National Payments Corporation of India (NPCI).

This change comes during a period of significant growth for UPI. The latest figures show that in December 2024, UPI recorded a total of 16.73 billion transactions, an 8 per cent increase from the 15.48 billion transactions in November 2024.

The total value of these transactions surged to Rs 23.25 lakh crore in December, compared to Rs 21.55 lakh crore in the previous month. On a daily basis, UPI handled 539.68 million transactions, which is more than the 516.07 million it handled the month before.

This increase is a result of UPI's growing acceptance and popularity in India, where it is quickly taking the lead as the preferred payment mechanism for both peer-to-peer and business transactions.