National Payments Corporation of India (NPCI) has launched an amazing feature, UPI Circle, which aims to make UPI even more convenient and accessible. It is proving to be a game-changer for people who do not have their bank account, especially children, elderly people, and people living in rural areas. Even if you have a ‘zero’ balance in your account, you will be able to make UPI payments. There is just one condition. You must be added to UPI Circle by a relative or friend. Let’s know how this magical process works and how it will change the way digital payments are made.

How UPI Circle Works

UPI Circle is a system that involves two different parties:

Primary User: These are the people whose bank account is being linked and from whose bank account the payment will be made. They are the owners of the account.

Secondary User: These are the people who will make payments from the bank account of others. They do not need to have bank account information.

So, now let’s understand how this whole process works step-by-step:

Sending Invitation

First of all, the primary user has to send an invitation to one of his relatives or friends (whom he wants to include in the UPI Circle). This invitation will be sent through the UPI App.

Accepting Invitation

The secondary user has to accept the invitation received through his UPI app. Only then will they be able to become a part of the Circle?

Choosing Payment Method

The primary user has two options for payment, which he can set for the secondary user:

Fixed Amount and Period: The primary user can set a fixed amount for payment for a fixed period. For example, “Payments up to ₹5000 for the next 30 days.”

Every Payment Request: Another option is that every payment request made by the secondary user will go to the primary user for approval.

Payment Process

Once the payment method is selected, the process will work in two ways:

Unrequested payment up to a limit: If the primary user has allowed the secondary user to make unrequested payments up to a certain limit, the secondary user can make payments directly from the primary user’s account within that limit.

Payment by sending request: If such an option is not selected, the secondary user will have to first send a request to the primary user for every payment.

The payment will be completed only when the request is approved by the primary user.

Transaction History

Once the transaction is completed, the payment amount and related information will be visible only in the history of the primary and secondary users. This ensures privacy and security.

This is how UPI Circle works, and now any user, even without a personal bank account, can easily make digital payments.

Benefits of UPI Circle

UPI Circle feature has many great benefits that make it special:

This is the biggest benefit. For those who are unable to open a bank account for any reason, it is a boon.

Now parents can add their children to UPI Circle for pocket money, which will allow children to make payments without cash. This will give them digital literacy.

Elders who have difficulty managing a smartphone or bank account will be able to make payments easily by joining the circle of their trusted family members.

In rural areas where access to banks is limited, this facility will promote digital payments and strengthen financial inclusion.

Primary users can have complete control over the spending of their secondary users, thereby curbing unnecessary expenses.

All transactions happen on UPI’s secure network, reducing the risk of fraud.