World · India Bureau
India to impose UPI charges on large merchants from October 15
The Indian government has announced a new fee structure for Unified Payments Interface transactions, effective October 15. The charges will exempt individual consumers and small retailers, targeting only large merchants.
LSN India ·
India's government has unveiled a tiered fee structure for UPI transactions, marking a significant shift in the country's digital payment framework. The new charges, set to take effect from October 15, are designed to ensure a sustainable ecosystem for payment infrastructure development while protecting smaller market participants.
Under the new structure, different transaction values will attract varying fee levels. The charges will not apply to individual consumers conducting personal transfers, ensuring retail customers continue to benefit from the zero-fee model that has driven UPI's widespread adoption.
Small merchants and traders have also been exempted from the new fee regime, allowing the informal sector and small-scale retailers to continue using UPI without additional costs. This targeted approach aims to maintain financial inclusion while addressing sustainability concerns raised by payment service providers.
The charge structure focuses exclusively on large merchants and high-volume commercial users who benefit substantially from the digital payment infrastructure. This segmented approach reflects the government's effort to balance revenue requirements for maintaining UPI's technical backbone with the need to preserve accessibility for ordinary citizens and small businesses.
The move comes as stakeholders continue to debate the balance between free digital payment services and the operational costs associated with maintaining and upgrading India's payment infrastructure.