The National Payments Corporation of India (NPCI) has recently launched a groundbreaking feature called "UPI Circle." This innovative tool aims to broaden the accessibility of digital payments by allowing multiple users to access and manage a single UPI account. Designed specifically to assist individuals who may not have full control over their finances, UPI Circle is poised to make digital transactions more inclusive and convenient.

What is UPI Circle?

UPI Circle is a feature that enables a primary user to delegate payment responsibilities to trusted secondary users. This system is particularly beneficial for those who depend on others to manage their finances, such as elderly family members, children, or household workers. By linking their UPI accounts with secondary users, the primary account holder can grant them the ability to make payments on their behalf. This creates a seamless and secure way for individuals to conduct digital transactions without direct involvement in every transaction.

How UPI Circle Works: Types of Delegation

UPI Circle offers two types of delegation to cater to different levels of control and convenience:

1. Full Delegation: In this mode, the primary user grants the secondary user complete authority to initiate and complete transactions. The primary user can set predefined spending limits, within which the secondary user can operate independently. This setup is ideal for routine payments, allowing secondary users to manage day-to-day expenses without needing to seek approval for each transaction.
2. Partial Delegation: This mode provides a balance between control and flexibility. The secondary user can initiate a transaction, but it requires the primary user's authentication to finalize the payment. The primary user must enter their UPI PIN to approve the transaction. This option is particularly useful for managing larger transactions, ensuring that the primary user retains control while still enabling the secondary user to handle routine payments.

Key Guidelines for UPI Circle Implementation

To ensure a secure and user-friendly experience, the NPCI has established specific guidelines for UPI apps and Payment Service Providers (PSPs) implementing the UPI Circle feature:

1. Independent User Journey: Both primary and secondary users will experience separate user journeys on their respective UPI apps. This allows each user to maintain their preferences, control, and settings independently, ensuring a personalized experience while managing shared finances.
2. Mandatory Security Protocols: Security is a top priority for UPI Circle. All secondary users must utilize either passcodes or biometric authentication methods, such as fingerprint or facial recognition, to secure their transactions. These measures help prevent unauthorized access and ensure that only the intended users can make payments.
3. Linking Process: The process of linking a secondary user to a primary UPI account is straightforward and secure. The primary user can link secondary users by scanning a QR code or entering the secondary user's UPI ID. After this step, the primary user selects the secondary user's contact from their phone. In the future, NPCI plans to enhance security further by restricting manual entry of mobile numbers, allowing only contact selection from the phone's directory.
4. Delegation Limits: To maintain clarity and prevent overlapping responsibilities, NPCI has set specific limits on delegation. A primary user can delegate payment authority to a maximum of five secondary users. Conversely, a secondary user can only accept delegation from one primary user. This ensures that the delegation process remains straightforward and manageable.

Who Can Benefit from UPI Circle?

The UPI Circle feature is a game-changer for individuals who may not be fully equipped to manage their digital payments but still need access to financial services. Here are some key beneficiaries:

1. Elderly Family Members: Senior citizens often rely on younger relatives to manage their finances. With UPI Circle, they can delegate payment responsibilities to a trusted family member, allowing them to make digital payments without the need to handle every transaction personally.
2. Children or Dependents: Parents can use UPI Circle to grant their children or dependents controlled access to funds for daily expenses. This feature allows them to monitor and manage spending while ensuring their dependents have the financial support they need.
3. Household Workers: Many household workers need to make digital transactions but do not have their own bank accounts or UPI IDs. UPI Circle allows employers to link their UPI accounts with their workers, enabling them to conduct transactions easily and securely.

The Impact of UPI Circle on Digital Payment Accessibility

UPI Circle is set to revolutionize how digital payments are managed in India. By allowing multiple users to access a single UPI account, this feature addresses the needs of a diverse range of users who may struggle with managing their finances. It empowers them to participate in the digital economy while ensuring that they have the necessary support and control.

The introduction of UPI Circle aligns with NPCI's broader vision of promoting financial inclusion and making digital payments more accessible to all. As more UPI apps and PSPs adopt this feature, it is expected to significantly impact how digital transactions are conducted, particularly for those who rely on others to manage their financial affairs.

In a world increasingly dominated by digital transactions, UPI Circle offers a much-needed solution for those who require assistance in managing their finances. Whether it's elderly family members, children, or household workers, this feature ensures that everyone can participate in the digital economy securely and efficiently. As UPI Circle gains traction, it will undoubtedly play a crucial role in expanding the reach of digital payments across India, fostering greater financial inclusion and empowerment.

By understanding the full potential of UPI Circle, both primary and secondary users can make informed decisions about how to manage their shared finances, leading to a more inclusive and accessible digital payment ecosystem.

Resourced by : FinCrif - Instant Personal loan app in India