UPI Charges: What is the new rule, should you pay more for Rs 2K transaction? Check here
The field of digital payments in the country has undergone a significant revolution since the introduction of UPI. Today, from small shopkeepers to big e-commerce companies, everyone is connected to the UPI network. Over the years, the number of transactions made through UPI has grown exponentially and currently, UPI is the preferred mode of payment for most of us. However, starting from the new financial year i.e., April 1, a fee of 1.1 percent of the transaction value will be charged for amounts above ₹2,000 when using PPI on UPI. NPCI (National Payment Corporation of India) has issued a circular related to UPI, in which it has been stated that prepaid payment instruments i.e., PPI charges will be levied on merchant payments made through UPI. Here’s all you want to know:
This charge will apply to transactions above ₹2,000
• According to media reports, NPCI has stated in its circular that an interchange fee will be charged for transactions of more than ₹2,000.
NPCI Press Release: UPI is free, fast, secure and seamless— NPCI (@NPCI_NPCI) March 29, 2023
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
• Under this, a total of 1.1 percent of the interchange fee amount will have to be paid for transactions of more than ₹2,000 through UPI to PPI.
• NPCI’s press release states that Prepaid Payment Instruments (PPIs) have been permitted to integrate with the UPI interoperable ecosystem.
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• In this case, the interchange charge is to be paid for doing PPI merchant transactions. There is no interchange charge for transferring money from a bank account to another bank account.
• The interchange charge is payable on merchant transactions.
• At the same time, the circular mentions that there is no charge to be paid on peer-to-peer and peer-to-peer merchant transactions between bank accounts and PPI wallets.
The rule to come in-force from April 1
• This new rule will come into effect from 1 April 1 i.e. Saturday.
• After the implementation of this rule, the National Payment Corporation of India will hold its review meeting before September 30, 2023.