The National Payment Corporation of India (NPCI) clarified that there is no fee for users in a message posted on its official Twitter account. Interchange fees are typically charged for Prepaid Payment Instruments. (PPI). This indicates that there would be a 1.1% interchange fee for UPI transactions done using PPIs like wallets and credit cards.
Additionally, there are no fees for standard UPI payments, which are bank account-to-bank account based. According to NPCI’s Twitter post, “With this addition to UPI, customers will have the option of using any bank accounts, Rupay Credit card, and prepaid wallets on UPI enabled apps.”
How is this tax levied on taxpayers?
From April 1, UPI transactions made through PPIs like wallets and credit cards will have an interchange fee of 1.1% and customers won’t be charged.
Linking a bank account in any UPI-enabled app to make payments has historically been the most popular UPI transaction method and accounts for over 99.9% of all UPI transactions.
The NPCI stated that these bank account-to-account transfers “continue to remain free for customers and Merchants.”