Ministry of Finance has assured that UPI transactions will stay free, and the Modi government is not considering adding fees.
The Ministry of Finance made it clear that the Indian government has no plans to charge for UPI services. On August 21, the Finance Ministry responded to reports alleging that UPI payments would be charged extra. It clarified that the government would not charge extra for UPI payments because it is a digital public service that helps the economy run better and makes transactions easier for the public.
The ministry also explained that incentives were given to payment service providers last year, and this year, more incentives have been announced to help the country switch to digital. The Reserve Bank of India (RBI) asked for suggestions on charging for digital transactions on August 17.
When asked about the Return on Investment (RoI) for service providers, the Finance Ministry said that they (service providers) will have to come up with other ways to make money.
However, “there will be no charge for UPI transactions,” said the Finance Ministry.
The Ministry said that in 2021, concessions were given to the service providers in the digital payment ecosystem, and in 2022, they got even more help. “The government helped fund the #DigitalPayment ecosystem last year and has said it will do the same this year to encourage more people to use #DigitalPayments and promote cheap and easy-to-use payment platforms,” the Finance Ministry said.
What’s RBI’s take on this?
On Wednesday, August 17, the RBI asked people what they thought about fees for digital payment systems. The financial regulator also said that the fees should be fair and competitive for the users if they want to be used by more people. But RBI said again that they haven’t decided anything in this regard yet.
The RBI said that the people who run the payment systems should make enough money to keep them running and to invest in new technologies, processes, and systems.
Although there are several other payment methods like IMPS, NEFT, and debit cards, UPI has gained 26 crore unique users and five crore merchants within a short span of 6 years.