Faster UPI transaction now as NPCI cut UPI Application Programming Interface response time, know how it will impact users

Time of India

16-06-2025

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What did NPCI say about UPI APIs?
Serial number
UPI API
Entities
Existing response time
Revised response time
1.
Request Pay, Response Pay (Debit and Credit)
Remitter Bank and Beneficiary Bank
30 seconds
15 seconds
2.
Check transaction status
Remitter Bank and Beneficiary bank
30 seconds
10 seconds
3.
Transaction reversal (debit and credit)
Remitter Bank and Beneficiary Bank
30 seconds
10 seconds
4.
Validate Address (Pay, Collect)
Payer PSP, Payee PSP, Beneficiary Bank (Account+IFSC based transactions)
15 seconds
10 seconds
What does this mean?
Will a faster response time of UPI APIs result in higher cost?
Consumers can now experience faster UPI transactions, especially when making merchant payments. This is because the National Payments Corporation of India (NPCI) has gone for a significant update in the UPI server's software. These changes that are made in the Unified Payment Interface (UPI) server's software have become effective from June 16, 2025, will enable faster response time.In simple terms, merchant's bank account which accepts UPI payments from a customer needs to communicate with the customer's bank account through a server to execute various tasks such as validate the transaction, know its status, reverse any failed transactions, etc. This communication bridge between two banks is done by the UPI APIs for UPI transactions.But the UPI API (Application Programming Interface) which makes this communication bridge between the merchant's bank terminal and your UPI enabled bank account takes anywhere between 15 to 30 seconds to respond to the request. This is where NPCI has made the current changes. NPCI has cut the response time this API request to anywhere between 10 to 15 seconds i.e. up to 66% reduction in time if we take the maximum reduction from 30 seconds to 10 seconds.Due to this move by the NPCI, consumers making UPI payments can expect a faster transaction time and faster reversal of failed UPI transactions. Read below to know more about which particular consumer UPI transactions will get faster now due to this UPI API level changes.In a circular dated April 26, 2025, NPCI said:With the objective of streamlining the performance of UPI, it is hereby informed that the response time for UPI APIs initiated by NPCI is revised as follows:Source: NPCI circularNPCI said in the circular: 'The aforementioned revisions are intended to improve the customer experience. The members are required to ensure that they make the necessary changes in their system so that responses are handled within the revised time. If the members have any dependency/configuration changes at partner/ merchant's end, then the same also has to be taken care accordingly. Further, Members are requested to ensure that the changes to the response time should not adversely impact the technical decline (TD) thresholds.'Rahul Jain - CFO, NTT DATA Payment Services India explains what happens in the scenario where you scan a merchant QR code to pay them.'The cycle works like this for a consumer scanning a merchant QR code and paying: first the remitter bank raises a query to the UPI server through the UPI APIs, then the beneficiary bank answers the query and accepts the payment. If the payment could not be accepted then the money will be returned to the remitter bank and the customer gets a refund. The changes made by the NPCI are in this UPI API response time.'According to Jain, this means now the remitter and beneficiary banks will communicate amongst themselves faster and hence the transaction's status will be updated faster. Jain explains using an example: if earlier it took maximum 30 seconds to process the response for a UPI transaction request now the same transaction will take half of this time i.e. 15 seconds. So in 30 seconds now two transactions can be done instead of only one earlier.'Vishal Maru- Global Processing Head Financial Software and Systems- FSS, says: "In order to process the higher volume of UPI transactions, its' API response time has been reduced as stated in this circular. Accelerated API cycles effectively address this issue. Consumers will now receive faster transaction confirmations, particularly during reversals or collection requests, instances that usually induce stress."Maru highlights how the faster response time of UPI APIs diminishes system-level retry storms, which not only congest the system but can also lead to cascading timeouts. "By narrowing response windows, UPI is evolving into a self-regulating and failure-resistant network. Quicker timeouts also facilitate a more equitable distribution of traffic among PSPs and banks, enhancing consistency even during peak periods and benefiting users of smaller or regional banks not solely those utilizing the largest applications."Maru from FSS, says that the faster response time of UPI APIs may initially increase the cost by a slight margin, but in the long run it can decrease.'What sets this apart is that shorter response times also enhance cache efficiency and lessen unnecessary database interactions, thereby making each transaction less demanding on system resources. Consequently, although initial expenditures may see a slight increase, the cost per transaction is anticipated to decrease over time, benefiting banks, payment providers, and ultimately consumers. This is not merely an enhancement in speed; it represents a profound systemic optimization that aligns with India's goal to scale UPI to 1,000 crore monthly transactions by 2026 without sacrificing trust, cost, or user experience.Jain says this faster response time feature may not add any cost burden for anybody.'This may add some incremental volume to UPI transactions but more so it will help consumers and merchants. For consumers it would mean faster UPI transactions and for merchants it would mean faster payment received. Also I don't think this is going to add any additional costs of running UPI servers for banks and NPCI,' says Jain.