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<\/p>\nLast Updated:July 21, 2025, 15:05 IST<\/p>\n
NPCI will let users link overdraft and pre-approved credit lines to UPI for seamless transactions starting next month. Changes must be made by August 31, 2025.<\/p>\n
The circular has directed all UPI member banks, payment service providers (PSPs), credit line issuers, and third-party app providers (TPAPs) to implement the required changes by August 31, 2025.<\/p>\n
The National Payment Corporation of India is streamlining the process of accessing overdraft and pre-approved credit lines by borrowers directly through UPI. From the next month onwards, users can access overdraft and pre-approved loan facility that they have taken on back of gold, property, MFs, shares, etc. directly through UPI, making it easier to avail the services.<\/p>\n
According to a circular issued by the National Payments Corporation of India (NPCI) on July 10, 2025, users will be allowed to link their sanctioned credit lines\u2014backed by financial instruments like fixed deposits (FDs), shares, bonds, gold, and even property\u2014to UPI for seamless digital transactions.<\/p>\n
This update means that personal or business loans in the form of overdrafts can now be used directly via popular UPI apps such as PhonePe, Paytm, Google Pay, and others.<\/p>\n
What Is\u00a0 A Credit Line?<\/p>\n
A credit line (or line of credit) is a pre-approved loan amount that a bank or financial institution allows you to borrow from, as and when you need it. Think of it like a flexible loan\u2014you don\u2019t get the full amount upfront, but you can use any portion of it up to the limit, and interest is charged only on the amount you use, not the entire limit.<\/p>\n
Once linked to UPI, these funds can be used just like regular bank balances for making payments. However, the NPCI has made it clear that the use of such funds must strictly adhere to the purpose for which the credit line was granted.<\/p>\n
Implement Required Changes By August 31<\/p>\n
The circular has directed all UPI member banks, payment service providers (PSPs), credit line issuers, and third-party app providers (TPAPs) to implement the required changes by August 31, 2025. This move is expected to make digital credit more accessible while ensuring a unified and secure experience for users.<\/p>\n
Kunal Varma, Co-Founder and CEO of Freo, welcomed the move, stating that it adds stronger safeguards around credit usage. \u201cIt ensures that loans are used for the right reasons, and places responsibility on issuers to allow or restrict transactions based on internal and regulatory policies,” he said. For users, the change brings more responsible and transparent access to credit through UPI, helping prevent misuse of interest-bearing funds for unintended purchases.<\/p>\n
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More<\/p>\n Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More<\/p>\n Stay updated with all the latest business news, including\u00a0market trends<\/a>,\u00a0stock updates<\/a>,\u00a0tax<\/a>, IPO,\u00a0banking finance<\/a>, real estate, savings and investments. Get in-depth analysis, expert opinions, and real-time updates\u2014only on News18. Also\u00a0Download the\u00a0News18 App<\/a>\u00a0to stay updated!view commentsFirst Published:Disclaimer: Comments reflect users\u2019 views, not News18\u2019s. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use<\/a> and Privacy Policy<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"Last Updated:July 21, 2025, 15:05 IST NPCI will let users link overdraft and pre-approved credit lines to UPI…\n","protected":false},"author":2,"featured_media":10583,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[64,63,12583,12582,203,12577,12578,12579,12580,105,12581,12576],"class_list":["post-10582","post","type-post","status-publish","format-standard","has-post-thumbnail","category-mobile","tag-au","tag-australia","tag-credit-line-linking","tag-digital-transactions","tag-mobile","tag-national-payment-corporation-of-india","tag-npci","tag-overdraft-through-upi","tag-pre-approved-credit-lines","tag-technology","tag-upi-apps","tag-upi-credit-line"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/10582","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=10582"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/10582\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/10583"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=10582"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=10582"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=10582"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"authorimg\"](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2025\/07\/WhatsApp-Image-2025-02-11-at-14.38.33-2025-02-47cdd4fd31681cc3efe5087cb8bd1418.jpeg\")
Varun Yadav<\/a><\/p>\n