New Delhi: In a landmark move that redefines digital payments in India, the National Payments Corporation of India (NPCI) has rolled out a major upgrade to the Unified Payments Interface (UPI), allowing users to make payments using biometric authentication — including facial recognition and fingerprints — without requiring a PIN. The upgrade, effective from October 8, 2025, marks the beginning of what NPCI is calling UPI 2.0, aimed at making payments faster, safer, and more convenient for millions of users.
Face and fingerprint payments go live
The most significant change in UPI 2.0 is the introduction of biometric-based transactions. Users can now authenticate payments directly through facial recognition or fingerprint scanning, removing the need to enter a four- or six-digit PIN. This feature is expected to make the process seamless, especially for microtransactions and quick retail purchases.
According to NPCI, the technology leverages advanced biometric verification linked to Aadhaar and the device’s hardware-level security. The move aims to enhance user trust while reducing transaction friction — a key challenge for UPI users in high-traffic or low-connectivity areas.
“UPI 2.0 brings India closer to a truly frictionless payment ecosystem. With biometric authentication, users can now pay securely without remembering PINs or passwords,” said an NPCI spokesperson.
New limits and transaction rules
Alongside biometric payments, UPI 2.0 also introduces revised transaction caps and new timing rules. Users can now perform balance checks only a limited number of times per day to reduce server load and congestion during peak hours.
NPCI has also updated the autopay system, allowing users to schedule automatic payments such as bills, subscriptions, or EMIs during specific time windows to optimise network performance. Furthermore, transaction limits for certain categories like education, healthcare, and government services have been increased, offering more flexibility for high-value payments.
Industry insiders say these structural changes will not only help banks and apps manage traffic better but also ensure faster settlements and fewer failed transactions.
Boosting speed and reducing congestion
With India recording over 14 billion UPI transactions monthly, congestion during peak hours has become a recurring issue. UPI 2.0 aims to tackle this with intelligent load balancing and transaction scheduling.
The NPCI claims that these updates will reduce congestion by up to 30% during busy periods such as festivals, sale days, and salary disbursement weeks. The introduction of new limits for non-critical operations, such as balance checks and low-value verifications, is expected to help free up bandwidth for payment authorisations.
Digital payment experts believe these changes will significantly enhance the UPI experience. “The system’s stability is paramount. By optimising network load and introducing biometric validation, NPCI is addressing two of UPI’s biggest challenges — congestion and security,” said Ramesh Iyer, fintech analyst at a Mumbai-based consultancy.
Security and privacy measures
While the new system eliminates the need for manual PIN entry, it also strengthens security through biometric encryption. Each face or fingerprint scan is matched using a tokenised identifier, ensuring no raw biometric data is stored or transmitted during transactions.
NPCI has assured users that all biometric data will remain encrypted and processed locally on the device, following the Personal Data Protection Act guidelines.
Additionally, UPI apps have been instructed to include transparent consent mechanisms, allowing users to opt in for biometric authentication at their discretion.
A step toward a smarter payment future
Since its inception in 2016, UPI has revolutionised India’s digital payments landscape, enabling instant peer-to-peer and merchant transfers. With UPI 2.0, the NPCI seeks to maintain its global leadership in fintech innovation.
Experts view this update as a major step towards integrating AI-driven security and biometrics into everyday payments — a trend already visible in markets like Singapore and South Korea.
As UPI continues to expand internationally, these enhancements could also boost its adoption abroad, especially in countries exploring cross-border interoperability with India’s payment ecosystem.
Conclusion
UPI 2.0 represents a pivotal moment in India’s financial technology journey — one that blends convenience, security, and innovation. With biometric payments, optimised transaction management, and stronger privacy frameworks, the new upgrade positions UPI as not just a payment tool but an evolving digital infrastructure supporting India’s cashless future.