Faster UPI: Response time cut by 67%, transaction confirmation in 10-15 seconds; how customers will benefit

From Monday, the Unified Payments Interface (UPI) got faster as new performance guidelines issued by the National Payments Corporation of India (NPCI) have come into effect, reducing the response time for key UPI APIs by up to 67%.

“Faster UPI is likely to drive a significant increase in transaction volumes, particularly in high-frequency use cases such as retail, subscriptions, and transit payments. The entire ecosystem stands to benefit, including faster UPI, meaning quicker checkouts, greater consumer trust in digital payments, and near-instant settlements for merchants. It will also unlock new possibilities in real-time rewards, credit, and embedded finance, fuelling further innovation,” said Amit Koshal, co-founder and CEO of Twid, a Bengaluru-based digital payment platform.

This way, when people see their money move faster and reliably, they are more likely to use UPI for everyday needs. Kunal Varma, founder and CEO, Freo, says, “Speed builds trust. Whether it's paying for groceries, splitting bills with friends, or even shopping online. A faster UPI experience will encourage more users to move away from cash and card payments, driving up transaction volumes.”

What is changing?

According to the updated guidelines, the response times for various UPI services have been revised. “Importantly, as countries like Singapore, France, and the U.A.E. adopt UPI-style payment systems, this speed upgrade further strengthens India’s position as a global leader in digital payments infrastructure,” said Koshal.

These improvements will help banks and payment apps respond more quickly when processing payments, checking status, handling reversals, or validating user details. “However, this acceleration also places greater responsibility on banks and NPCI to scale infrastructure to support the expected surge in volume,” said Koshal.

New rules to control API usage

In a circular dated May 21, 2025, NPCI also introduced strict rules for Payment Service Providers (PSPs) and acquiring banks to improve UPI’s performance by managing how often certain APIs are used. Some of the key limits include:

Balance enquiry: Maximum 50 times per user per day. Only user-initiated.

List keys: Only once per PSP (such a Google Pay, Paytm, PhonePe) per day, during non-peak hours.

List account: This feature allows customers to find a list of accounts linked to their mobile by a particular account provider. It has been capped at 25 times per user per day, only after selecting the bank.

Check transaction status: This API allows the PSPs to request the status of a transaction. 

Autopay mandate execution: Only 1 attempt and 3 retries allowed.

Penny drops: Needs customer consent and must be queued during non-peak hours.

Validate address: Can only be used when a customer initiates payment, not for backend operations.

NPCI has also asked PSPs to avoid overloading systems during peak hours (10:00 am-1:00 pm and 5:00 pm-9:30 pm). APIs must be used only for their intended purposes. A mandatory system audit is required by July 31, 2025, and audit reports must be submitted by August 31, 2025.

How does this benefit customers

These changes will make UPI transactions quicker and reduce failed or delayed payments. For instance, if someone sends money to a friend, the transaction confirmation that earlier took 30 seconds could now happen in 10-15 seconds. This is especially helpful during peak times like festival seasons or bill payment days.

“For users, it is all about smoother, quicker transactions, especially during peak hours or time-sensitive payments. For the ecosystem, it unlocks new possibilities. Faster UPI can enable real-time services like instant credit disbursals, smoother checkout for e-commerce, and even better support for recurring payments. Overall, it pushes UPI closer to becoming the default payment method for most digital transactions in the country,” said Varma.