The National Payments Corporation of India (NPCI) recently issued a circular stating that users will be required to pay 1.1% of the transaction value when using PPIs on UPI for transactions exceeding Rs 2000. When using Prepaid Payment Instruments (PPIs), the new fee was set to take effect on April 1, 2023.
The NPCI provided additional clarification on Tuesday, stating that customers will not be charged for the new interchange fees, which are only applicable to PPI merchant transactions.
“The Prepaid Payment Instruments (PPI Wallets) have been allowed to be a part of an interoperable UPI ecosystem under recent regulatory guidelines. Considering this NPCI has now allowed the PPI wallets to be essential for interoperable UPI environment. An NCPI release stated, “It is further clarified that there are no charges for the bank account to bank account based UPI payments (i.e. normal UPI payments).” The introduced interchange charges are only applicable to PPI merchant transactions and are not charged to customers.
NPCI Press Release: UPI is free, fast, secure and seamless
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
— NPCI (@NPCI_NPCI) March 29, 2023
Because of the new UPI guideline, you won’t have to pay any fees if you pay directly from your bank. Be that as it may, in the event that you top up your UPI with some other application and, you continue towards additional installment, such installments surpassing Rs 2000 will get charged at 1.1 percent.
Customers will be able to use any bank account, RuPay credit card, or prepaid wallets on UPI-enabled apps with this addition to UPI, it added.
NCPI added that UPI has become the preferred method of digital payment in recent years due to its free, quick, secure, and seamless experience.
“Traditionally, linking a bank account in any UPI-enabled app to make payments has been the preferred method for UPI transactions, accounting for over 99.9% of all UPI transactions. Customers and merchants can still conduct these free transactions from one bank account to another,” NCPI added.
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