UPI Transactions Over 2K To Attract 1.1% Fee: Know More Details Here

New Delhi: The National Payments Corporation of India (NPCI) recently announced that using Prepaid Payment Instruments (PPIs) for transactions through UPI will attract an interchange fee.

Reportedly, the charges will be levied if the transaction is more than ₹ 2,000. The interchange fee varies for the different categories of merchants. It ranges from 0.5% to 1.1% and a cap is also applicable in certain categories.

In a notification issued today, NPCI said that the introduced fee is only applicable for merchant transactions made through prepaid payment instruments. The payments body clarified that no charges will be levied on normal UPI payments which it termed as “bank account- to-bank account based UPI payments.”

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NPCI Press Release: UPI is free, fast, secure and seamless
Every month, over 8 billion transactions are processed free for customers and merchants using bank-accounts@EconomicTimes @FinancialXpress @businessline @bsindia @livemint @moneycontrolcom @timesofindia @dilipasbe pic.twitter.com/VpsdUt5u7U

— NPCI (@NPCI_NPCI) March 29, 2023

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In August last year, the Finance Ministry stated that UPI is a digital public good and that it was not considering levying any charges on transactions made through it. “UPI is a digital public good with immense convenience for the public & productivity gains for the economy. There is no consideration in Govt to levy of any charges for UPI services. The concerns of the service providers for cost recovery have to be met through other means,” the ministry tweeted.