UPI transactions to remain free, nominal charges may apply on limited merchant transactions, govt clarifies
The Indian government has clarified that UPI transactions will remain free for consumers, despite recent legislative updates. While nominal charges may eventually apply to a limited set of merchant transactions, there will be no blanket fees for users.
Why it matters
UPI is a cornerstone of India's digital economy, and maintaining its accessibility is vital for continued financial inclusion and digital adoption.
The union government on Saturday clarified that transactions via UPI will remain free and attract no charges, after the passing of the Payment and Settlement Systems Act, 2007 in Lok Sabha earlier this week. Earlier reports had suggested that the Bill would allow the government to permit banks and payment companies to charge fees on UPI and other digital payments in the future.However, in a press release, the Centre has now stated that a vast majority of transactions would remain free of charge for customers as well as merchants. However, it said that nominal charges may apply on certain limited merchant transactions.“Consumers making payments will not face any transaction charges,” the government said, adding that all person-to-person (P2P) transactions would continue free of charge.
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