The National Payments Corporation of India (NPCI) is considering a major shift in UPI (Unified Payments Interface) regulations to enhance digital payment security. As part of its ongoing efforts to curb payment fraud, NPCI is in discussions with banks about potentially discontinuing the ‘Pull Transaction’ feature.
What Are Pull Transactions? In UPI, transactions occur in two ways: Push and Pull. Pull transactions happen when a merchant sends a payment request to a customer for a fixed amount, and the customer only needs to authorize it by entering their UPI PIN. This system is widely used for auto-debiting recurring payments like utility bills, subscriptions, and EMIs.
Why Ban Pull Transactions? Pull transactions, though convenient, have become a target for fraudsters who exploit automatic payment approvals. By disabling this feature, NPCI aims to reduce unauthorized debits and strengthen security measures for digital payments.
Impact on Users and Merchants If the ban is implemented, customers will have to manually approve each payment, even for recurring bills and subscriptions. While this adds a layer of security, it could disrupt automated payments, requiring merchants to send reminders for each transaction.
Alternative Solutions in the Works NPCI is exploring safer alternatives like the e-KYC Setu System, which enhances identity verification without exposing sensitive information. Additionally, new auto-debit frameworks could require periodic user approvals, minimizing risks while preserving convenience.
Staying Secure: What Users Can Do To safeguard their accounts, users should enable SMS and email alerts for transactions, set UPI limits, and regularly review their bank statements. Avoiding suspicious payment links and downloading UPI apps only from official stores are crucial steps to prevent unauthorized access.
As discussions continue, NPCI’s proposed changes mark a significant step toward fortifying India’s digital payment landscape, ensuring safer transactions for millions of UPI users.
