India’s digital payments regulator has reassured users that Unified Payments Interface transactions will continue to be free for consumers and small merchants, despite ongoing discussions about funding and potential fees.
India’s digital payments watchdog has sought to calm speculation that Unified Payments Interface transactions may soon carry a consumer fee, saying ordinary UPI transfers will remain free for users and that small merchants will also not be charged for accepting them.
The Payments Council of India said in a statement that people across the country can continue making instant payments through UPI without transaction charges. It added that any merchant service charges are commercial terms between merchants and payment service providers and do not mean consumers will be asked to pay for everyday digital purchases.
The clarification comes amid a wider debate over how the UPI network is funded as usage keeps rising. According to the National Payments Corporation of India, most UPI transfers are simple account-to-account payments and remain free for both consumers and merchants unless the government decides to review the policy. Reports in Business Standard and Moneycontrol have also noted that recent interchange fees introduced on some payment instruments in the UPI ecosystem do not apply to standard UPI bank transfers.
The PCI said banks, fintech companies, NPCI and the Reserve Bank of India have continued to invest in technology, cyber security, fraud prevention and product development to support the system. It described UPI as a key piece of national digital infrastructure, now used daily by millions of people and businesses, and warned that further growth will depend on sustained spending to keep the network secure, resilient and reliable.
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