3 hrs ago
UPI Merchant Charges Above Rs 2,000, Consumers Stay Exempt
Some businesses may have to pay a small fee when customers use UPI to pay more than Rs 2,000.
The fee can be as high as 0.4% of the payment.
In some categories, such as fuel and railway tickets, it may be up to Rs 5.
Customers will not be charged this fee directly.
Sending money to another person will also remain free.
Small merchants earning Rs 1 lakh per month will not face the new charge, according to the government.
The new framework is scheduled to take effect on October 15.
The articles describe the fee as a change in how banks and merchants cover UPI processing costs.
Certain UPI merchant payments above Rs 2,000 will attract interchange charges under a revised pricing framework.
The charge can be up to 0.4% and will be levied on merchants, not consumers.
Person-to-person UPI transfers will remain free regardless of transaction value.
Specified categories, including fuel, railway ticketing, telecom services and insurance, may attract a charge of up to Rs 5.
The government said small merchants earning Rs 1 lakh per month will not face the new fee.
- Who
- The National Payments Corporation of India introduced the revised framework, with charges applying to certain merchants; consumers remain exempt.
- What
- Certain UPI merchant payments above Rs 2,000 will carry merchant-side interchange charges of up to 0.4%, while person-to-person transfers remain free.
- Where
- The changes apply to transactions made through UPI in India.
- When
- The revised framework is set to take effect on October 15.
- Why
- The framework is intended to restructure how participating banks and merchants cover the cost of processing some transactions while preserving free UPI use for consumers.
Key facts
- Threshold
- Charges apply to certain merchant payments above Rs 2,000.
- Standard rate
- The interchange charge can be up to 0.4%, with one article specifying a cap of Rs 300.
- Specified categories
- Fuel, railway ticketing, telecom services and insurance are among the listed categories.
- Category charge
- The articles describe charges in specified categories as Rs 5 or up to Rs 5, depending on the applicable category and transaction value.
- Consumer fee
- Consumers will not be charged directly for the revised interchange fee.
- Person-to-person transfers
- All person-to-person UPI transactions will remain free regardless of value.
- Small merchants
- The government said merchants earning Rs 1 lakh per month will not face the new fee.
- Effective date
- The revised framework is scheduled to begin on October 15.
Sources
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