Starting October 1st, 2024, you’ll no longer be able to send money requests to friends and family through UPI apps like PhonePe, Google Pay, and Paytm. The National Payments Corporation of India (NPCI) has directed banks and payment apps to halt all peer-to-peer (P2P) “collect requests” to address rising financial fraud.
This significant change affects millions of UPI users who regularly use the “Request Money” feature for splitting bills, collecting dues, or asking for payments from friends and family.
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Why UPI NPCI Banned P2P Money Requests
Fraud Prevention: The primary reason behind this decision is the alarming rise in digital payment fraud. Scammers have been exploiting the money request feature to trick unsuspecting users into making unauthorized payments by disguising collect requests as legitimate transactions.
User Protection: Many users accidentally approve money requests thinking they’re receiving payments, leading to financial losses. The ban aims to eliminate this confusion and protect users from such scams.
What Changes from October 1st, 2024
Features Affected vs Unaffected
| Feature | Status After Oct 1st | Alternative Available |
|---|---|---|
| P2P Money Requests | ❌ Completely Banned | Direct payment only |
| Merchant Collect Requests | ✅ Still Available | Official merchant requests |
| UPI Send Money | ✅ Fully Functional | Primary payment method |
| QR Code Payments | ✅ No Changes | Scan and pay continues |
| Bill Payments | ✅ Normal Operations | All utility payments work |
Impact on Different User Categories
Regular Users: Those who frequently split restaurant bills or request money from friends will need to adapt to direct payment methods. Instead of sending a request, you’ll need to ask verbally and wait for the other person to initiate the payment.
Small Business Owners: Merchants can continue to submit collect requests, so legitimate business transactions remain unaffected. Official merchant accounts will still function normally for payment collection.
Students and Young Adults: This demographic heavily relies on money requests for shared expenses. They’ll need to develop new habits around splitting costs and collecting payments.
Alternative Ways to Collect Money
Since P2P money requests won’t work, here are practical alternatives:
- Direct Communication: Simply ask the person to send money directly through UPI
- Share UPI ID: Provide your UPI ID or phone number for direct transfers
- QR Code Sharing: Generate and share your personal QR code for payments
- Digital Expense Splitting Apps: Use third-party apps that integrate with UPI for group expenses
For more insights on digital payment trends and security tips, stay updated with the latest fintech developments.
How This Affects Popular UPI Apps
Major UPI platforms are already implementing these changes:
PhonePe: The “Request Money” option will be removed from P2P transactions but retained for merchant payments.
Google Pay: Users will see notifications about the upcoming change, with the collect request feature being phased out.
Paytm: Similar implementation timeline with focus on educating users about alternatives.
Preparing for the Change
Update Your Habits: Start practicing direct payment methods instead of relying on money requests. Communicate payment needs clearly with friends and family.
Educate Others: Help elderly family members and less tech-savvy users understand these changes to avoid confusion.
Stay Vigilant: Even with these new rules, remain cautious about any payment requests from unknown sources.
Learn more about financial technology updates and digital payment security to protect yourself in the evolving digital landscape.
The Bigger Picture
This move represents NPCI’s commitment to making UPI safer while maintaining its convenience. UPI processes instant real-time payments and has become integral to India’s digital economy, so protecting users from fraud is crucial for maintaining trust in the system.
The ban specifically targets P2P requests while preserving merchant functionality, striking a balance between security and business needs.
While this change may require some adjustment, it’s a necessary step toward making digital payments safer for everyone. Embrace direct payment methods and stay secure in your UPI transactions.
Frequently Asked Questions
Q: Can I still receive money through UPI after October 1st?
A: Yes, you can still receive money through UPI. The ban only affects the “money request” feature where you ask others to pay you. People can still send you money directly using your UPI ID, phone number, or QR code without any issues.
Q: Will this change affect online shopping and bill payments?
A: No, online shopping and bill payments remain completely unaffected. The ban only applies to peer-to-peer money requests between individuals. Merchant collect requests, online purchases, utility bill payments, and all other UPI transactions continue to work normally.
