India’s finance ministry clarifies that the Unified Payments Interface will continue to offer free person-to-person transfers and most merchant payments, addressing concerns over potential user fees as the system’s usage accelerates and expands internationally.
India’s finance ministry has moved to calm fears that Unified Payments Interface payments could soon carry a user fee, saying customers will not be charged for using the system and that person-to-person transfers will stay free. The clarification comes after a fresh round of concern over whether the fast-growing digital payments platform could begin to lose its zero-cost status for ordinary users.
According to the ministry, the overwhelming majority of merchant payments will also remain free. Where a merchant discount rate is applied, it would be limited to certain larger transactions and would stay modest. The government said the aim is not to burden customers but to keep the payments network financially sustainable as usage keeps climbing.
The clarification also fits with recent comments from India’s payments authorities. The National Payments Corporation of India has said normal bank-to-bank UPI transfers do not attract customer charges, while an interchange fee of 1.1% applies only to some merchant payments made through prepaid payment instruments, such as wallets. The Reserve Bank of India has also said there is no proposal to levy charges on UPI transactions.
Officials have framed the debate as one of scale and resilience. The finance ministry said continued investment is needed in cyber security, fraud prevention and infrastructure as transaction volumes rise sharply. UPI processed 2,366 crore transactions worth ₹29.9 lakh crore in the latest month cited by the government, and the system is now active in 11 countries, underlining how central it has become to India’s digital payments network.
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