On November 7, 2023, the National Payments Corporation of India (NPCI) recently released important guidelines about deactivating UPI IDs, UPI numbers, and phone numbers for customers who have remained idle or inactive for a year. This action is meant to ensure better security, avoid accidental fund transfers and protect the interests of UPI users.

Understanding UPI ID Deactivation

Deactivation refers to the act of disabling UPI debit for customers who have not carried out any financial or non-financial activities such as balance inquiries or changes in the past year, says Mehul Mistry, Global Head of Strategy for Digital Financial Services Partnerships at Wibmo – a PayU company. The date and voluntary deadline for deactivating the UPI IDs of the customers with inactive profiles is December 31,

NPCI New Guidelines for UPI ID Holders

1. Identification of Inactive Customers: All Third Party Application Providers (TPAPs) and Payment Service Provider (PSP) banks are mandated to identify UPI IDs, associated UPI numbers, and phone numbers of customers who have not conducted any financial or non-financial transactions for at least a year.
2. Deactivation of UPI IDs and Numbers: UPI IDs and UPI numbers of identified inactive customers shall be disabled for inward credit transactions, ensuring enhanced security and preventing unintended fund transfers.
3. Deregistration of Phone Numbers: In addition to deactivation, PSPs must deregister the phone numbers associated with the inactive UPI IDs from the UPI mapper.
4. Re-registration Process: Customers with deactivated UPI IDs and phone numbers must re-register in their respective UPI apps for UPI mapper linkage, enabling them to resume transactions.
5. Transactional Flexibility: Despite the deactivation, customers can still make payments and perform non-financial transactions using their UPI PIN as needed.
6. Requester Validation: UPI apps are instructed to perform Requester Validation (ReqValAd) before initiating ‘pay-to-contact’ or ‘pay to the mobile number,’ adding a layer of security to the transaction process.
7. Customer Name Display: UPI apps are now required to show the customer’s name fetched before initiating a transaction, ensuring transparency, and shall not display cached names stored at the app’s end.

Conclusion

As the UPI continues to be the most preferred digital payment method, these guidelines by NPCI demonstrate the commitment to maintaining a secure and reliable transactional experience. With over 11 billion transactions amounting to ₹17.16 lakh crore in October alone, UPI remains a pivotal player in the digital payment landscape, now fortified by these proactive measures to ensure user safety and prevent unauthorized transactions.