Have you received a forward or message on WhatsApp that says UPI transactions are no longer free and a fee has to be paid for every online transaction? Do not worry as the message is fake and misleading.
NPCI or National Payment Corporation of India refuted the claim in a statement posted on its official Twitter handle. Here is the full statement:
“In the recent times, UPI has emerged as preferred mode of digital payment by offering free, fast, secure and seamless experience. Traditionally. the most preferred method of UPI transactions is linking the Bank account in any UPI enabled app for making payments which contributes over 99.9% of total UPI transactions. These Bank account-to-account transactions continue to remain free for Customers and Merchants.
Recent regulatory guidelines, the Prepaid Payment Instruments (PPI Wallets) have been permitted to be part of interoperable UPI ecosystem. In view of this NPCI has now permitted the PPI wallets to be part of interoperable UPI ecosystem. The interchange charges introduced are only applicable for the PPI merchant transactions and there is no charge to customers. and it is further clarified that there are no charges for the bank account to bank account based UPI payments (i.e. normal UPI payments).
With this addition to UPI, the Customers will have the choice of using any bank accounts, Rupay Credit card and prepaid wallets on UPI enabled apps.
This means that only UPI transactions made using PPIs like credit cards, wallets, etc. would incur an interchange fee of 1.1% from 1st April 2023. The charges would be applicable for transactions over Rs. 2000.
According to NPCI, more than eight billion transactions are processed free of charge for merchants and customers. UPI or United Payment Interface was developed by NPCI as an instant payment system. It groups together several bank accounts into a single mobile application. It also merges different banking features and offers seamless merchant payments.
NPCI was incorporated in the year 2008. It is an umbrella organization for carrying out ‘retail payment and settlement systems’ in India. NPCI aims to reform India into a digital economy. It focuses on making innovations in the retail payment systems by using technology with persistent hard work.