Concerns over possible charges on UPI payments have been eased after the Payments Council of India (PCI) clarified that ordinary consumers will continue to use UPI without transaction charges.
DON'T MISS
The clarification comes amid growing discussion over the possibility of introducing a Merchant Discount Rate (MDR) on certain UPI transactions. The issue had triggered confusion among users about whether they would eventually have to pay a fee every time they made a digital payment.
UPI Payment to Remain Free for Consumers
According to the PCI, consumers will not be charged for making UPI payments. Small merchants, including neighbourhood shops, are also expected to remain outside the proposed charging framework.
This means that everyday person-to-person UPI transfers and routine digital payments will continue to remain free for users, providing relief to millions who rely on UPI for daily transactions.
What Is the UPI Charge Debate About?
The current discussion is primarily focused on whether larger commercial merchants should pay a nominal MDR on selected transactions. Recent proposals have considered charges on certain higher-value merchant transactions, rather than imposing a fee on ordinary customers.
The proposed framework is aimed at creating a sustainable revenue model for banks and payment service providers while supporting investments in technology, cybersecurity and fraud prevention.
Small Merchants Also Get Relief
The PCI has specifically indicated that small merchants will not be burdened with UPI charges. This is significant for local shops and small businesses that depend heavily on digital payments from customers.
%20on%20certain%20UPI){kind=link}