UPI Payment Charges to stay Free – Modi Govt Has No Plans to Levy Charges on UPI Transactions

No charges on UPI Transactions

The Centre stated on Sunday that there are no intentions to charge users of the Unified Payments Interface (UPI) for using the service, despite the fact that it is a “digital public benefit with tremendous convenience.” The Ministry of Finance today confirmed that the Government is not considering imposing fees for UPI services.

A brief about Govt Plans to Levy Charges on UPI Transactions:

UPI is a digital public good that offers the public great ease and boosts economic output. The government is not considering implementing any fees for UPI services. The ministry said that there must be alternate ways to address the service providers’ worries about cost recovery.

Days after the Reserve Bank of India (RBI) requested public feedback on UPI payments and levies, the Ministry of Finance clarified the situation. Regarding fees for UPI transactions, the RBI has not yet provided any directives. Beginning on January 1, 2020, the government will enforce a framework with zero fees for UPI transactions. As a result, neither users nor merchants will incur any fees when using UPI. “A few questions on what method should be implemented have been included, keeping in mind that the purpose of this discussion paper is to elicit general views,” the RBI stated in its Discussion Paper on Charges in Payment Systems.

The merchant discount rate (MDR) for transactions using the RuPay debit card and up to Rs 2,000 in transactions using BHIM-UPI would be reimbursed by the Center under its Rs 1,500 crore budgetary allocation for “promotion of digital payments” in the financial year 2021–22.

For FY23, the Centre has put aside Rs 200 cr large integer for the promotion of digital payments within the Budget.

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