India’s Unified Payments Interface will continue to be free for the majority of users, with officials reassuring the public amid recent speculation of potential charges on large transactions and merchants, though plans for narrow fee applications are under consideration.
India’s Unified Payments Interface is set to remain free for ordinary users, with officials and payments industry bodies moving to reassure the public that most everyday transactions will not attract charges. The clarification comes after renewed speculation over whether the government might reintroduce some form of merchant fee on the fast-growing digital payments system.
In October 2025, Reserve Bank of India Governor Sanjay Malhotra said there was no proposal to levy charges on UPI transactions, according to Business Standard and Moneycontrol. He said the payment network would stay free for users, a position that helped calm concern over possible changes to the zero-cost model that has underpinned UPI’s rapid adoption across India.
That position echoes an earlier explanation from the National Payments Corporation of India in March 2023, when NPCI said bank account-to-account UPI transfers would remain free for both customers and merchants. Reuters-style reporting at the time followed confusion sparked by the introduction of interchange fees on merchant payments made through prepaid payment instruments, a narrower category that did not affect standard bank-to-bank UPI transfers.
More recently, reports in July 2026 suggested the government had been considering a limited merchant discount rate, or MDR, on UPI payments for large businesses and higher-value transactions. Under that proposal, street vendors, small shops and person-to-person transfers would still have been exempt, reflecting an attempt to preserve free access for smaller users while addressing the costs of maintaining the payments infrastructure.
For now, the overall message from officials remains that UPI’s core promise of free, frictionless digital payments is intact for the vast majority of users. Any future change, if one is ever adopted, appears likely to be narrowly targeted rather than a broad move towards charging consumers or small merchants.
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