Consumers already bearing UPI costs indirectly: RBI governor
RBI Governor Sanjay Malhotra stated that consumers already indirectly bear the costs of UPI transactions, even without explicit merchant fees. He noted that it is premature to introduce direct fees while the focus remains on scaling the infrastructure to 800 million daily transactions.
Why it matters
The debate over UPI merchant fees impacts the sustainability of India's digital payment ecosystem and the business models of major fintech players.
NEW DELHI: RBI governor Sanjay Malhotra said consumers already bear the cost of UPI transactions indirectly even if merchant fees are not explicitly charged.Responding to questions on enabling merchant fees on UPI, Malhotra said it was too early to take a view and the focus remains on strengthening the payments infrastructure. “it is very premature right now. Now, costs have to be paid by someone — it's a public [good]; we all want this particular infrastructure to continue to strengthen, become more efficient. That's our focus as of now — let's watch how developments proceed,” he said.Government has proposed amendments to the law that barred any form of merchant fees on UPI transactions. There have also been reports that the government plans to allow merchant fees to be charged on UPI transactions with value of over Rs 2,000.
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