Relax, No Charges On UPI Payments: Finance Minister
Making payments has been so much easier since the UPI launch. But from the last few days, there was a rumor in the market that UPI will also be chargeable.
In response to rumors that it could introduce extra fees on UPI payments, the national government has confirmed its position.
The Ministry of Finance stated in a series of tweets on Sunday that UPI (Unified Payments Interface) is a “digital public benefit” and that there are no plans to charge for UPI services.
The Indian government has provided financial assistance for the nation’s digital payments ecosystem, according to the tweet, which also stated that alternative methods must be used to fund the cost of recovery.
The ministry continued by saying that it had also announced assistance for this year to promote increased use of electronic payments.
The statement was made in response to rumors that UPI transactions would be subject to an extra fee in order to support the payments infrastructure.
According to a discussion paper published on August 17th, the Reserve Bank of India has also requested input on the matter. The document covered various digital payment methods, such as –
- Immediate Payment Service (IMPS),
- National Electronic Funds Transfer (NEFT) system, and
- Real Time Gross Settlement (RTGS) system,
even though it was not specifically about UPI transactions.
The government’s zero-MDR (merchant discount rate) policy, which is still in effect for RuPay and UPI transactions, was called for in the report. Service providers contend that by adding an MDR fee to digital payments, systems can be improved.
Before the release of the Union Budget 2022, the Payments Council of India (PCI), the industry association for the nation’s digital payments ecosystem, wrote to the government requesting that –
The zero-MDR regime for UPI and Rupay debit cards will be rolled back. Debit cards from Visa and Mastercard currently incur MDR (0.4 to 0.9%), which is split between the issuer banks and acquirer.
The RBI’s paper about UPI sought input on whether it should be handled properly from Visa and Mastercard debit. In the tweet, the government stated that it supports “economical and user-friendly” digital payments.