Have you ever been stuck at a shop counter only to realize your bank balance is too low to complete a UPI payment? To solve this common problem, the National Payments Corporation of India (NPCI) has introduced a powerful new feature called UPI Now Pay Later, officially known as Pre-Approved Credit Line on UPI.
With this feature, UPI payments are no longer restricted to the money available in your savings account. Even if your balance is zero, you can still make instant payments using a credit limit approved by your bank.
What is UPI Now Pay Later?
UPI Now Pay Later is a digital credit facility where banks offer customers a pre-approved credit line based on their credit profile and transaction history.
Earlier, UPI payments could only be made if sufficient funds were available in the bank account. Now, users can pay using a credit limit and repay the amount later, similar to how a credit card works—but without needing a physical card.
This feature is especially helpful during month-end cash shortages or unexpected expenses.
How does UPI Now Pay Later work?
To activate this feature, your bank first evaluates your credit history and CIBIL score. If eligible, the bank approves a credit limit—usually ranging from ₹20,000 to ₹50,000 or more—which appears directly in your UPI app.
When you scan a merchant’s UPI QR code:
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You’ll see your bank account and a “Credit Line” option
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Select the credit line to complete the payment
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The amount is deducted from your approved limit instantly
At the end of the billing cycle, you receive a statement and can repay the amount as per the agreed terms. The entire process is paperless and happens in real time.
Key Benefits of UPI Credit Line
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Payments possible even with zero bank balance
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No need for a credit card
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Works on any UPI QR code, even where cards aren’t accepted
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Ideal for emergency expenses
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Fully digital and quick activation
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Timely repayment helps improve your credit score
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Flexible “spend now, pay later” option
Who can avail UPI Now Pay Later?
To use this facility, users must meet the following conditions:
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Must be an Indian citizen
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Minimum 18 years of age
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Must have a valid Aadhaar and PAN card
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Mobile number must be linked to bank and Aadhaar
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Subject to bank’s credit approval criteria
