The Government of India has clarified that it won’t levy any charges on Unified Payments Interface (UPI) services.
In a tweet, the finance ministry said that UPI would remain free. “UPI is a digital public good with immense convenience for the public and productivity gains for the economy. There is no consideration in Govt to levy any charges for UPI services. The concerns of the service providers for cost recovery have to be met through other means,” the tweet read.
Highlights from what the government said:
1) After reports circulated online that there may be the possibility of UPI transactions carrying a service charge, the finance ministry on Sunday denied the news.
2) The RBI discussion paper issued earlier this month on charges in the payment system suggested that UPI payments might be subject to a tiered charge based on various amount brackets.
3) The RBI discussion paper said, UPI as a fund transfer system is like IMPS and therefore, it could be argued that the charges in UPI need to be similar to charges in IMPS for fund transfer transactions.
4) Currently, there are no charges levied on transactions done through UPI.
5) Earlier, Prime Minister Narendra Modi Prime Minister Narendra Modi had hailed the UPI transactions crossing 6 billion in July.
6) The number of digital transactions in July was the highest ever since 2016.
7) UPI reported 6.28 billion transactions amounting to ₹10.62 trillion, according to data released by the National Payments Corporation of India (NPCI).
8)”The Govt had provided financial support for #DigitalPayment ecosystem last year and has announced the same this year as well to encourage further adoption of #DigitalPayments and promotion of payment platforms that are economical and user-friendly,” the finance ministry said in a tweet.
9) In India, the RTGS and NEFT payment systems are owned and operated by RBI. Systems like IMPS, RuPay, UPI, etc, are owned and operated by the National Payments Corporation of India (NPCI).
10)The government has mandated a zero-charge framework for UPI transactions with effect from January 1, 2020. This means that charges in UPI are nil for users and merchants alike.
