The Lok Sabha has approved a bill allowing banks to levy fees on UPI transactions, contrasting with official claims that the system will remain free, raising questions about future pricing and regulation.
A report by TeluguPost said the Lok Sabha has approved a bill that would give banks the power to levy charges on Unified Payments Interface transactions, while also leaving room for them to waive such fees for customers. The report said the lower house backed an amendment to the Payment and Settlement Systems Act, 2007 without debate and amid opposition concerns, and that the move could leave pricing decisions to banks rather than the government.
The claim lands against a backdrop of repeated official denials that UPI payments will be charged. In October 2025, Reserve Bank of India Governor Sanjay Malhotra said there was no proposal to impose charges on UPI transactions and that the system would remain free, according to Business Standard. He also pointed to ongoing work on an artificial intelligence-based fraud detection system aimed at reducing risks in digital payments.
That position followed earlier government statements about UPI not being subject to Goods and Services Tax. In July 2025, the Finance Ministry told the Rajya Sabha there were no plans to levy GST on UPI payments above ₹2,000, according to The Economic Times. In April 2025, the ministry separately dismissed similar rumours as baseless, saying UPI does not attract merchant discount rate charges and that no GST applies.
Taken together, the reports suggest a sharp disconnect between the TeluguPost account and the more recent official line from the central bank and finance ministry. If the Lok Sabha has indeed moved to amend the payments law, the practical impact would still depend on how banks and regulators choose to apply any new authority, and whether the government confirms that UPI users will face any charges at all.
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