After a lot of social media buzzing that the Government plans to add fee to UPI transaction, Union Finance Ministry clarified that there is no plan to add a service charge for UPI transactions.
“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 any charges for UPI services. The concerns of the service providers for cost recovery have to be met through other means,” the Finance Ministry said in a tweet.
The tweet further added that The Government has provided financial support for digital payments and is also encouraging more adoption of new payment platforms that are economical and easy to use.
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Govermnet had to issue a clarification after Media reports interpreted the latest RBI document called “Discussion Paper on Charges in Payment Systems” to imply that the Government was considering adding fees to each financial transaction made through UPI. The media reports produced a buzz on social media, and prompted many people to inquire about Government’s response.
The RBI’s discussion paper covers every facet of the impact of charges on various methods of payment, including UPI, IMPS, NEFT, RTGS, debit cards and credit cards.
The report advocates for a review of all the different types of fees in payment systems and highlights how their prices, in balance, should allow adequate revenue for companies. “It was considered useful to carry out a comprehensive review of the various charges levied in the payment systems by highlighting different dimensions and seeking stakeholder feedback,” it said.
What is UPI?
Unified Payments Interface (UPI) is a payment interface that allows you to make payments directly from your bank account to any merchant. You can use UPI to pay for online shopping, book tickets, or even split a bill with your friends. All you need is the recipient’s UPI ID and you can make a payment instantly. UPI is very safe and secure as it uses two-factor authentication to protect your money.