What is UPI Circle and How Does it Work?

Until now, to make payments through UPI, each person had to link their bank account to a unique UPI ID on their phone. But in August 2024, the National Payments Corporation of India (NPCI) introduced a new feature called ‘UPI Circle.’ This allows multiple people to use the same UPI ID, which can be especially helpful in family situations. For example, parents can give their children access to the family account without any hassle, making it easier for kids to receive money or make payments.

If you want to learn more about how UPI Circle works and the NPCI’s requirements, check out the full blog below.

What is UPI Circle?

UPI Circle is a new feature introduced by NPCI that lets multiple people use the same UPI ID for transactions. The main user, usually the account holder, can share this UPI ID with someone they trust—like a family member or friend—making them a secondary user. Both users can then carry out transactions through the same bank account.

One of the main features of UPI Circle is that the primary user can set limits on what the secondary user can do. This helps control how much access the secondary user has. Additionally, the primary user can easily manage and adjust these permissions, either granting or revoking access whenever needed, making sure the system stays secure.

How Does UPI Circle Work?

The UPI Circle is a new feature that's slowly being introduced on various UPI apps. Many platforms are still testing it, so the details shared here are based on information from NPCI.

There are two ways the UPI Circle can be used, also referred to as access types:

1. Full Delegation: In this option, the primary user can set a monthly limit of up to Rs 15,000 for the secondary user. This means the secondary user can make payments within this limit, but each payment cannot exceed Rs 5,000. The primary user grants full access, and the secondary user can make transactions freely within these limits.
2. Partial Delegation: With partial delegation, the primary user has to approve each payment request made by the secondary user. This means that the secondary user cannot make payments independently; every transaction needs prior approval from the primary user.

This feature provides flexibility in how payments are managed and helps ensure better control over spending.

Guidelines Set by NPCI for UPI Circle

To ensure that UPI Circle remains a secure method for delegating access, the National Payments Corporation of India (NPCI) has set clear guidelines for both primary and secondary users.

1. User Flexibility: Both primary and secondary users can choose their preferred UPI apps. This means each user can use the UPI platform they are most comfortable with, keeping their experience independent.
2. Security for Secondary Users: All secondary users must use either biometric verification or an app password to access the system. This is a necessary security step to protect sensitive information.
3. Limits on Secondary Users: A primary user can authorise up to five secondary users or devices. However, a secondary user can only be linked to one primary user, meaning they cannot have access from multiple primary users at once.
4. Transaction Limits: Secondary users have a monthly transaction limit of Rs. 15,000 and can only perform individual transactions of up to Rs. 5,000.
5. Partial Access Delegation: If a primary user grants partial access, the standard UPI transaction limits will still apply to the secondary user.
6. Authorisation Control: The primary user has full control over what kind of access a secondary user gets, whether full or limited. This gives the primary user flexibility in managing how the secondary user can use UPI.
7. Initial Transaction Limits: When a user links their UPI for the first time, both the primary and secondary users will face a per-transaction limit of Rs. 5,000 for the first 24 hours.
8. Transaction History Visibility: The primary user can view all transactions made by secondary users and has complete access to the secondary user’s bank account statement, ensuring transparency.

Who is the User of a UPI Circle

Primary User of UPI Circle

The primary user of a UPI Circle is the person who owns the bank account linked to the circle. This person has the highest level of control and authority within the circle. They are responsible for setting it up and managing all transactions within it.

The primary user can decide who will be trusted as their partner in the circle, granting them full or partial access to the account. They also have the power to set transaction limits, manage the UPI PIN, and add or remove secondary users from the circle as needed. In addition to managing the circle, the primary user can also carry out transactions within it.

Secondary User of UPI Circle

A secondary user is someone added to the UPI Circle by the primary user. Unlike the primary user, a secondary user doesn't need to link their bank account to the circle. The secondary user can be a family member, friend, or spouse who is granted access by the primary user as a trusted person in the circle. The primary user decides the level of access and authority a secondary user has.

Features of UPI Circle

Understanding the Requirements of UPI Circle

To use UPI Circle, there are a few things you need to have in place:

First, the primary user, who holds the UPI account, needs to make sure their bank details are correctly entered and set up in the UPI app. This ensures smooth transactions.

Next, the secondary user must have their own UPI account set up, as it’s essential for linking the two accounts.

Lastly, the primary user should save the secondary user's mobile number in their phone’s contact list. This step is necessary because the UPI app uses the saved number to connect both users in the Circle.

Once all of this is done, the setup will be complete, and both users will be able to interact through UPI Circle.

How to Enable UPI Circle

To enable UPI Circle, follow these simple steps:

• Step 1: Open your UPI app and go to the section where you can manage your UPI Circle
• Step 2: Look for the option that says "Add family or friends to your circle" and tap on it. Then, tap "Get Started."
• Step 3: You’ll be asked to either enter the UPI ID of the person you want to add or scan their UPI QR code. Once you’ve done that, tap "Add to my UPI Circle."
• Step 4: Next, a list of contact numbers will appear. Make sure the phone number of the person you want to add matches the one listed. For security reasons, you can’t enter the number manually.
• Step 5: Now, choose how much control you want to give. You can pick "Spend with limits" (Partial delegation) if you want to set spending limits, or "Approve every payment" (Full delegation) if you want to review every transaction. If you select partial delegation, you’ll be able to set a spending cap, specify a bank account, and even choose an end date for this permission.
• Step 6: Tick the box to agree to the Terms and Conditions, then tap "Proceed."
• Step 7: Finally, tap "Confirm" to submit your request, and you’re done!

How to Transfer Funds Using UPI Circle?

To transfer funds using UPI Circle, the process begins once the primary user sets up the Circle and the secondary user accepts the invitation. The primary user also needs to set up a UPI PIN for transferring money and share it with the secondary user.

For the secondary user to transfer funds, they can follow these steps:

1. First, they enter the UPI ID of the person they want to send money to or scan their QR code.
2. Next, they enter the amount they wish to transfer.
3. There is an option to add a note or remark for the transaction, though this is optional.
4. To complete the transfer, the secondary user enters the UPI PIN. This is required if they have full delegation. If the secondary user only has partial delegation, when they try to initiate the transfer, the primary user gets a notification through the UPI app.
5. In this case, the primary user must enter their UPI PIN to approve and finalise the transaction from their bank account. If the secondary user has full delegation, they can complete the transfer on their own without needing approval from the primary user.

Closing Thoughts

UPI Circle offers a convenient way for families and trusted individuals to share access to bank accounts for easy payments. With flexible control over permissions and transaction limits, it makes managing shared finances simpler and more secure. As the feature continues to roll out, it’s sure to make transactions smoother for many users.

Frequently Asked Questions (FAQs)

1. How many users can be part of a UPI Circle?

   A UPI Circle allows the primary user to add up to 5 secondary users. However, each secondary user can only be part of one UPI Circle at a time.

2. Does UPI Circle support UPI Lite?

   No, UPI Circle does not support UPI Lite at the moment.

3. What is the maximum limit for UPI Circle transactions?

   For secondary users, the monthly limit is Rs. 15,000, and the maximum amount allowed per transaction is Rs. 5,000, according to NPCI guidelines.

4. Can I grant full access to a secondary user in UPI Circle?

   Yes, as the primary user, you can choose to give full or partial access to a secondary user for handling UPI transactions.

5. Do I need to submit any documents to add someone to my UPI Circle?

   Since your UPI is already linked with your Aadhaar and PAN, you don’t need to submit any new documents to add someone to your UPI Circle.

6. Do I need a separate app to use UPI Circle?

   No, you can use the same UPI app that you already have to perform transactions within your UPI Circle. There’s no need for a separate app.

7. Can a secondary user add me as the primary user in UPI Circle?

   No, only the primary user has the ability to add secondary users to the UPI Circle. A secondary user cannot add the primary user.

8. Is there a fee to subscribe to UPI Circle?

   No, subscribing to UPI Circle doesn’t require any payment. There are no subscription fees involved.

9. Does a secondary user need to pay any fees to use UPI Circle?

   Neither the primary nor the secondary user is required to pay any fees to use UPI Circle.

10. Can I change the access levels for a secondary user later on?

    Yes, you have the option to change the delegation settings for secondary users at any time after adding them.

11. Can I track the transactions made by a secondary user in UPI Circle?

    Yes, as the primary user, you can view all the transactions made by secondary users in both the UPI app and your bank account statement.