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Small businesses want recurring collections but do not know how UPI AutoPay mandates work, what limits apply or how failures show up.
The customer approves a UPI mandate once with amount cap, frequency and validity; the business presents each debit through its gateway; a pre-debit notification goes 24 hours ahead; failures come back as gateway status.
Gateway AutoPay set-up, mandate records with cap and validity, retry rules, and a ledger mapping each gateway settlement to customer invoices.
Recurring instalments collected and matched to invoices, with failed debits retried or moved to another mode.
UPI AutoPay lets a customer approve a recurring debit once in their UPI app. This approval is called a UPI mandate. After that, the business presents each instalment automatically, and the customer gets a notification before every debit. It is common for subscriptions, SIPs, insurance premiums and small EMIs.
How is a UPI mandate created, and what limits apply?
- The business, through its payment gateway, sends a mandate request with the amount (fixed or a maximum), frequency (monthly, weekly, and so on) and validity (start and end date).
- The customer sees it in their UPI app and approves with their UPI PIN.
- The mandate goes live. The gateway confirms it to the business.
Limits to know:
- ₹15,000 per debit can be collected without the customer entering a PIN each time.
- ₹1 lakh per debit for insurance premiums, mutual fund subscriptions and credit card bill payments.
- Above these limits, the customer has to authenticate each debit.
- A pre-debit notification goes to the customer at least 24 hours before each debit, under RBI’s e-mandate framework, and the customer can opt out of that debit.
These are the limits as of October 2026; check NPCI and your gateway for any later change.
How is AutoPay different from other UPI payments?
| Type | Who starts each payment | Customer approval | Typical use |
|---|---|---|---|
| UPI AutoPay (recurring mandate) | Business, on schedule | Once, at set-up | Subscriptions, SIPs, premiums, EMIs |
| One-time mandate (block and debit later) | Business, once | Once, funds blocked | Bookings, IPO applications |
| Normal UPI payment | Customer | Every payment | Shop counter, invoice payment |
Does it cost the business anything?
AutoPay sits outside the notified UPI MDR framework. Even when the new UPI merchant charges start (NPCI has postponed the start to after Diwali 2026), AutoPay is not part of that framework as notified. But your payment gateway may charge its own platform fee per debit or per mandate, plus 18% GST on that fee. Read the gateway agreement and check the fee lines on each settlement.
Worked example: a ₹499 monthly plan
A software firm sells a ₹499 monthly plan. A customer approves AutoPay with a maximum of ₹499, monthly, due on the 5th.
- 4 November: customer receives the pre-debit notification.
- 5 November: debit fails; the customer’s balance was low.
- 6 November: the gateway retries and succeeds. ₹499 collected.
Suppose the gateway charges an illustrative platform fee of ₹3 plus 18% GST of ₹0.54 on that debit. Settlement to the firm’s bank: ₹499 − ₹3 − ₹0.54 = ₹495.46.
In the books:
- Customer invoice ₹499 is cleared by the gateway receivable.
- Gateway fee ₹3 to expense; ₹0.54 to input GST if a tax invoice is received.
- Bank ₹495.46 clears the gateway receivable.
The bank statement does not show ₹499; it shows the gateway’s settlement, often one credit for many customers. Matching back needs the gateway’s settlement report.
When does UPI AutoPay suit a business, and when not?
It suits frequent, smaller amounts where quick set-up matters: ₹149 to ₹2,499 subscriptions, SIPs and premiums. For larger fixed EMIs above ₹15,000 that run for years, many lenders still use eNACH, because no per-debit authentication is needed regardless of amount within the mandate.
What should a business check every month?
- Mandates live versus customers billed. Every active subscriber should have a live mandate; a gap means someone cancelled or never completed set-up.
- Failures by reason. Low balance can be retried; a revoked mandate cannot.
- Settlement totals. The gateway’s settlement report for the month should add up to the bank credits, after fees and GST on fees.
- Fee invoices. Collect the gateway’s GST tax invoice so input credit on its fees can be claimed.
A short monthly check like this catches most leaks before they become a quarter’s worth of missing revenue.
What to read next
- UPI AutoPay vs eNACH for subscription tickets compares cost and reliability.
- Subscription SaaS MDR economics
- What is auto-debit
Recurring collection and gateway settlement reconciliation are on the TransactIG roadmap; see NACH batch reconciliation and payment gateway reconciliation.