Parliamentary panel flags concerns over new UPI merchant transaction fee

Lawmakers, predominantly from the Opposition benches, voiced concern on Wednesday about the Centre's newly announced fee structure on digital payments, characterizing the move as detrimental to ordinary citizens and businesses. The issue was raised during a meeting of the Parliamentary Standing Committee on Finance, prompting Chairman Bhartruhari Mahtab to indicate that the matter would likely feature in the panel's next session.

RSP MP NK Premchandran, a committee member, articulated the concerns of several lawmakers, stating that the decision would have ramifications across the entire country. "It is a completely anti-people decision," Premchandran said, reflecting the sentiment of opposition parliamentarians present at the meeting.

The government implemented the fee structure on Tuesday, marking the end of nearly six years of zero-cost UPI transactions. From October 15, merchants conducting transfers worth more than Rs 2,000 through UPI will incur a charge of 0.4 per cent, though person-to-person transactions between individuals remain exempt from the levy.

The move has triggered concerns about its potential impact on small traders and the broader adoption of digital payment systems, with committee members suggesting further deliberation may be needed before the policy takes full effect.