The National Payments Corporation of India (NPCI) said that it has allowed prepaid payment instruments (PPIs) or digital wallets to become part of the interoperable UPI ecosystem. The organization also clarified that the 1.1 per cent charge on UPI transactions will not be paid by the customers. Further, NPCI said that ‘bank account to account transactions will be free for customers and merchants’.
“With the recent regulatory guidelines, Prepaid Payment Instruments (PPI Wallets) have been permitted to become part of the interoperable is i Ecosystem. The interchange charges introduced are applicable only for PPI merchant transactions and there are no charges for customers, and it is further clarified that there is no charge for bank account-based UPI payments (i.e. normal UPI payments) to bank accounts. No fee,” NPCI said in a statement.
“With the integration of UPI, customers will have the option of using any bank account, RuPay credit card and prepaid wallet on UPI enabled apps,” the organization said.
NPCI Press Release: UPI is free, fast, secure and seamless
Every month, over 8 billion transactions are processed free of charge for customers and merchants using bank accounts@economictimes @financialexpress @business Line @bsindia @livemint @moneycontrolcom @times of India @dilipasbe pic.twitter.com/VpsdUt5u7U
– NPCI (@NPCI_NPCI) March 29, 2023
What is NPCI talking about?
For the unversed, UPI transactions above Rs 2,000 at 1.1 per cent starting April 1, said NPCI in a recent circular. All online merchants, large merchants and small offline merchants with transaction value/amount paid in excess of Rs 2,000 have been notified, the circular said.
This fee will not be levied on all UPI transactions above Rs 2,000. Instead, the fee will be charged from merchants who accept payments of Rs 2,000 or more through PPIs such as Amazon Pay, Google Pay or mobile wallets such as Paytm. Also, the 1.1 per cent fee will not be charged on all UPI transactions above Rs 2,000. Instead, it will vary between 1.1 percent to 0.5 percent. For example, fuel purchases would be charged 0.5 percent, while supermarket purchases would be charged 0.9 percent.
However, some messages on social media suggested that from April all UPI transactions would be charged. But now NPCI has issued a statement clarifying that these charges will not be paid by the customers.
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